Nsu Act202 Project(budgeting) 6d5i3v

MANAGE RIAL ING

MASTER BUDGET BURGER

OF

YOO BRO

Submitted by: Section: 18 Name

ID

Abdullah Al Noman

1510941030

Shahriar parvej

1510459630

Nishat Tasnim

1410886630

Md. Kamrul Islam (17)

1510560630

Ragib Noor Rohan

1510999030

Submitted to: Bushra Ferdous Khan School of Business and Economics North South University

Table of contents:

Topic

Page no.

Executive summary

01

Introduction

02

Cost identification chart

03

Calculation of POHR and Unit cost

03

Sales Budget

04

Production budget

05

Direct material budget

06

Manufacturing overhead

07

Selling and istrative budget

08

Cash Budget

09

Income statement

10

Balance sheet

11

Conclusion

11

Executive summary:

We have chosen the item “Burger” for making this report. Yoo bro burger sales only beef burger. We took an interview of a similar kind of business and got ideas of their business operation, data about their raw material, per day sales, monthly sales, profit, there costing type and so on. This targeted sale is about 3600-5000/5500 units of burger for a month, as we are able to sell 120-150 burgers per day. Selling price per burger is 140 taka. And the approximate cost per burger is not more than 90/92 taka. Beef steak is collected from retail supplier on 2/3day basis; other raw materials are collected from the closest market. We use fresh material for the production. Approximate direct material cost is 55taka per unit.70% of purchase paid in the month purchase and 30% pays by the following month. Salary of the chef is paid by monthly basis, so there is no direct labor cost for the business. Other item onion, sauce, mayonnaise, tomatoes also used for the production but it’s not possible to trace them as unit basis. So this item is calculated as the manufacturing cost for the period. We have used production unit as our allocation base. The pre-determined overhead rate is 34.74. POHR is getting higher as there all labor cost is indirect. Yoo bro burger has 3 sales person and salaries are paid by monthly basis 15000 taka each. A security guard salary is 8000 taka. The variable selling and istration cost for package and napkin is 3 taka per unit. We maintain 50000 taka minimum cash balance for a month. The rent of our restaurant is 50000 taka per month. You bro burgers fixed assets are tables, chairs, fridge, and the other machinery item. Our cash balance for the period was 1005850 taka and the total asset are around 3-4 lakh taka.

Yoo bro burgers budgeted net income is 831600 taka for the period.

Introduction: Here we have chosen to make Burgers. The name of our business is Yoo bro Burger. We sell only beef burger. Our shop is located in purbachal, 300ft. road, Kaji Food Island. Our targeted customer is young boys and girls who come here often after classes in the 300ft spot. We sell quality food and use all the fresh material in the production. Our profit is comparatively high from the competitors. We tried to make an assumption for our coming half year production, sales and profit. Here we mention all the material and the item used for operate our business.

Cost identification:

Product cost

Cost item

Direct cost YES YES YES YES

Burger bun Beef steak Lettuce cheese onion Frying oil Packaging Napkin Salary of chef Salary of waiter Tomatoes Rent

Manufacturing overhead

Fixed cost

YES YES YES

YES YES

Variable cost YES YES YES YES YES YES YES YES

YES YES

Period cost

YES YES YES

YES YES

Predetermined overhead rate: = Total estimated Manufacturing overhead/Total Estimated Allocation Base = 889600/25600 =34.75 Unit Product Cost: =Direct material per unit + Moh per unit = 55+34.75 =89.75

(All labor cost is indirect here)

Sales Budget: Key Components: 1. Budgeted sales for the half year: July:

3600 units

August:

4000

September:

4500

October:

4000

November:

5000

December:

4500

2. Selling price is 140 taka per unit. 3. All sales made is cash, there are no on sales.

Sales budget: July 3600

Budgeted Unit sales Selling 140 Price per unit Total 504000 budgeted sales

August 4000

September 4500

October 4000

November December 5000 4500

Total 25600

140

140

140

140

140

140

560000

630000

560000

700000

630000

3584000

Production Budget: Key component: In our business, there is no ending inventory as we sell fresh product everyday .So production budget will be same as Sales budget.

Production Budget: Budgeted Unit sales Productio n required

July 3600

August 4000

September 4500

October 4000

November December Total 5000 4500 25600

3600

4000

4500

4000

5000

4500

25600

Direct material budget:

Key components: 1. YOO BRO burger collects beef steak from retail supplier ARONG. Per unit needs 1 beef steak and the cost per beef steak is 40 taka. 2. Other raw materials used are traced on per unit basis. Costs are given below:  Bun per unit 10 taka,  Cheese cost per unit 4 taka and latus per unit cost is 1 taka 3. We use fresh material for burger. There are no raw material which we use for a long period. So there will be no ending raw material inventory for the period. 4. Yoo bro burger pay 70% of raw material purchase in the month of purchase and remaining 30% on the following month. 5. June s payable was 50000 taka

Direct material budget: Required production Units Materials Bun per unit cost Beef stick per unit cost Cheese per unit cost Latus per unit cost Total COST OF DM PER UNIT TOTAL DM COST

July 3600

August 4000

September 4500

October 4000

November 5000

December 4500

Total 25600

10

10

10

10

10

10

10

40

40

40

40

40

40

40

4

4

4

4

4

4

4

1

1

1

1

1

1

1

55

55

55

55

55

55

55

19800 0

220000

247500

220000

275000

247500

140800 0

Cast disbursement for direct material: July

Augu st

Septem ber

payable 50000 July purchase 138600 59400 August purchase 154000 66000 September 173250 purchase October purchase November purchase

Octob er

Novemb er

Decemb er

50000 198000 220000 247500

74250 154000

Total

66000 192500

82500

220000 275000

December purchase TOTAL CASH DISBURSMEN T

188600 213400 239250

228250

258500

173250

173250

255750

1383750

** payable for this period is 74250; which is 30% of December purchases.

Manufacturing overhead Budget: Key components: 1. Manufacturing overhead is applied to units of product on the basis of budgeted production. 2. Variable manufacturing overhead cost is 16 taka per unit which covers the cost of onion, tomato, frying oil and mayonnaise. 3. Monthly Rent for the restaurant is 50000 taka, chef monthly salary 20000 taka. 4. Depreciation cost of equipment is 10000 taka.

Manufacturing overhead Budget: July Production required Variable MOH rate Variable MOH cost Fixed MOH Total MOH cost Less: Depreciation Cash

August

September October

Novembe r

Decembe r

Total

3600

4000

4500

4000

5000

4500

25600

16

16

16

16

16

16

16

57600

64000

72000

64000

80000

72000

409600

80000

80000

80000

80000

80000

80000

480000

137600

144000

152000

144000

160000

152000

889600

10000

10000

10000

10000

10000

10000

60000

127600

134000

142000

134000

150000

142000

829600

disbursement s for MOH

Total MOH Production Budget POHR

889600 25600 34.75

Selling and istrative budget: Key components: 1. Variable selling and istrative expenses is 3 taka per unit. This cost covers the packaging, napkin, and other cost. 2. There are 3 waiters. The salary of each waiter is 15000 taka per month. 3. Security guard salary is 8000 taka per month. 4. Depreciation cost is 10000 taka. Selling and istrative budget: July Budgeted unit Variable expense per unit Variable S&A expense Fixed S&A exp Total S&A exp Less: non cash exp. Cash S&A exp

August

Septembe r

October

Novembe r

December Total

3600

4000

4500

4000

5000

4500

25600

3

3

3

3

3

3

3

10800

12000

13500

12000

15000

13500

76800

63000 73800

63000 75000

63000 76500

63000 75000

63000 78000

63000 76500

378000 454800

10000

10000

10000

10000

10000

10000

60000

63800

65000

66500

65000

68000

66500

394800

Cash budget: Key components:

1. Yoo bro burger maintains minimum 50000 taka cash for month. 2. No borrowing is needed for this period. 3. Beginning cash balance is 30000 taka here.

Cash budget

July August September October 30000 154000 301600 483850 504000 560000 630000 560000 534000 714000 931600 1043850

Beginning cash balance Add: Cash collections Total cash available Less: Cash disbursements Direct materials 188600 213400 239250 Manufacturing 127600 134000 142000 overhead Selling and 63800 65000 66500 istrative Total cash disbursements 380000 412400 447750 Excess (deficiency) 154000 301600 483850 Financing: Borrowings Repayments Interest Total financing Ending cash balance 154000 301600 483850 *** Their Last month cash balance is 1005850 taka.

Novembe r December Total 616600 840100 30000 700000 630000 3584000 1316600 1470100 3614000

228250

258500

255750 1383750

134000

150000

142000

829600

65000

68000

66500

394800

427250 616600

476500 840100

464250 2608150 1005850 1005850

616600

840100

1005850 1005850

Income statement: Yoo bro burger Budgeted Income Statement For the year ended December 31, 2016 Details Sales ( 25600 X 140) Less: Cost of goods sold (25600*89.75) Gross margin Less: Selling and istrative expenses Operating income Less: Interest expense Net income

Taka 3584000 2297600 1286400 454800 831600 0 831600

Income statement data: 1 2 3

A total sale in unit is derived from the Sales Budget. Unit Product cost is 89.75 Taka. Selling and istrative expenses are derived from the Selling and istrative Expense Budget

Balance sheet: Key components:

Yoo bro burger reported the following balances prior to preparing its budgeted financial statements: 1 2 3

The cash balance of yoo bro burger has been derived from the Cash Budget. Yoo bro burger has equipment worth 200000 Taka @ 10% half-annual depreciation. Yoo bro burger also has chairs tables and other worth of 100000 Taka @ 10% half-annual

4 5

depreciation. The s payable balance is 30 % of December raw material purchase. Yoo bro burger also has a capital of 370000 Taka.

Details

Yoo bro burger Taka AssetsBudgeted balance sheet For the year 31dec, 2016

Current assets: Cash Equipment Depreciation on equipment (10%)

Taka

1005850

200000 20000 180000

Chair, tables & others Depreciation on Stall, chair, tables & others (10%)

100000 10000 90000 1275850

Total non-current assets Liabilities and Equity Current liabilities: s payable (materials) Total current liabilities Total liabilities Net income Capital Total equity Total equity and liabilities Conclusion:

74250 74250 74250 831600 370000 1201600 1275850

Here are all the budgets and business details of our restaurant. As a small business, the net profit is looking good and we are satisfied.