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GaMBA01.X0210 Management Accountant

FINAL EXAMSUBJECT: MANAGEMENT ACCOUNTANT

NAME: V VN HU

CLASS: GaMBA01.X0210

QUESTION:

Summary of situation:

Thang Loi Company is a commercial company which purchases many

different goods. The Company wants to make plan for the fourth Quarter.

According to selling experience of the company: 55% of turnover will be

recovered within that month, 35% will be come back after a month, 5% after two

months and 5% can not be got back.

Average selling price per unit: 11.000 VND

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GaMBA01.X0210 Management Accountant

On November 28, the Company must pay the loan of 92.700.000 VND

Request:

1. Formulate a sales budget, goods supply budget and payment plan for each

month of the fourth Quarter.

2. Assume that 80% of cost of goods sold will be collected within that month

and 20% recovered after one month, buying amount will be paid in the

next month of buying month. How does this assumption affect on sales

budget, goods supply budget and payment plan of the Company?

Formulate sales budget, goods supply budget and payment plan of the

Company for each month of the fourth Quarter according to this

assumption.

3. Analyze elements which can affect on carrying out sales budget, good

supply budget and payment plan of the Company.

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GaMBA01.X0210 Management Accountant

October : 60.000x11= 660.000

November : 80.000x11= 880.000

December : 50.000x11= 550.000

Expectation turnover in each month of the fourth Quarter:

October: 660.000x55%+440.000x35%+770.000x5% = 555.500

November: 880.000x55%+660.000x35%+440.000x5% = 737.000

December: 550.000x55%+880.000x35%+660.000x5% = 643.500

No. Targets October November December1 Quantity of selling goods 60.000 80.000 50.000

2 Selling price 11.000 11.000 11.000

3Turnover will be carried out(1x2) 660.000.000 880.000.000 550.000.000

4 Expectation turnover 555.500.000 737.000.000 643.500.000

5 55% 363.000.000 484.000.000 302.500.000

6 35% 231.000.000 308.000.000 192.500.000

7 5% 33.000.000 44.000.000 27.500.000

8 5% 33.000.000 44.000.000 27.500.000

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GaMBA01.X0210 Management Accountant

Therefore, The company will expectedly must pay for sellers:

- October: 364.000.000 (VND)

- November: 217.000.000 + 269.500.000 = 486.500.000 (VND)

- December: 269.500.000 + 178.500.000 = 448.000.000 (VND)

c. Payment plan

No Targets October November December

1 Expected Turnover

660.000.00

0 880.000.000 550.000.000

2 Buying products 62.000 77.000 51.000

3 Expected payment (6+8)

456.400.00

0 702.400.000 525.000.0004 - For one unit 7.000 7.000 7.000

5

- Total cost for production of

goods

434.000.00

0 539.000.000 357.000.000

6 - Paid for seller

364.000.00

0 486.500.000 448.000.000

7 50%

217.000.00

0 269.500.000 178.500.000

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GaMBA01.X0210 Management Accountant

Question 2: Actual sales got back 80% in selling month and 20% recovered after

one month, purchasing goods amount is paid by the company in the following

month. We have the following budget:

a. Sales budget:

No Targets

October November December

1 Selling Quantity 60.000 80.000 50.0002 Selling Price 11.000 11.000 11.000

3 Turnover 660.000.000 880.000.000 550.000.000

4 Amount receipts 616.000.000 836.000.000 616.000.000

5 80% 528.000.000 704.000.000 440.000.000

6 20% 132.000.000 176.000.000 110.000.000

In fact, we will receive amount as follows:

- October: 616.000.000 (VND)

- November: 704.000.000 + 132.000.000 = 836.000.000 (VND)

- December: 440.000.000 + 176.000.000 = 616.000.000 (VND)

C ith t ti

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GaMBA01.X0210 Management Accountant

3)

10 Finance:

11 - Pay loans 92.700.000

12 Surplus amount end term 273.600.000 137.400.000 (66.000.000)

We have actual amount must be paid for seller:

- October: 294.000.000 (VND)- November: 434.500.000 (VND)

- December: 539.000.000 (VND)

Compare with expectation:

- October: 364.000.000 (VND)

- November: 486.500.000 (VND)

- December: 448.000.000 (VND)

=> Therefore, except December, compare with expectation, the Company

will must pay for each month fewer.

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GaMBA01.X0210 Management Accountant

In narrow meaning, sales budgeting is a list of expenditures of a sales territory or

of group of activities.

Payment method or Amount receiptsion from customers will directly affect the

companys budget.

- Products difficult to sell: in order to maintain the estimated selling price, the

company will have to lengthen credit term for customers. As a result, the real

in-hand cash collected in that month is not upto estimated.

- Hot sale products: in-hand cash will be more in that month.

Besides, budgeting also depends upon sales forecast. Sales forecast is one of the

most important document in the company. Members of all functionaldepartments will plan their activities in accordance with sales forecast. All

activities such as budgeting implementation, human resource planning,

manufacturing, assest managing and distribution, etc. will depend on accuracy of

sales forecast.

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GaMBA01.X0210 Management Accountant

back in the following months. As a result, budgeting for next

month must be increased.

THE END

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FULL CALCULATION TABLE

Estimation:

SALES BUDGETNo. Targets August September October November December January next year1 Selling quantity 70.000 40.000 60.000 80.000 50.000 60.000

2 Selling price 11.000 11.000 11.000 11.000 11.000 11.000

3 Expected turnover(1x2) 770.000.000 440.000.000 660.000.000 880.000.000 550.000.000 660.000.000

4 Estimation of Amount receipts 423.500.000 511.500.000 555.500.000 737.000.000 643.500.000 599.500.000

5 55% 423.500.000 242.000.000 363.000.000 484.000.000 302.500.000 363.000.000

6 35% 269.500.000 154.000.000 231.000.000 308.000.000 192.500.000 231.000.000

7 5% 38.500.000 22.000.000 33.000.000 44.000.000 27.500.000 33.000.000

8 5% 38.500.000 22.000.000 33.000.000 44.000.000 27.500.000 33.000.000

GOODS SUPPLY BUDGETS

No. Targets August September October November DecemberJanuary next

year1 Quantity of products need selling 70.000 40.000 60.000 80.000 50.000 60.000

2

Quantity of products need

reserving end term 6.000 8.000 10.000 7.000 8.000 2.000

3 Stored product quantity first term 9.000 6.000 8.000 10.000 7.000 8.000

4 Products need purchasing (1+2-3) 67.000 42.000 62.000 77.000 51.000 54.000

5 Cost:

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6 - For one unit 7.000 7.000 7.000 7.000 7.000 7.000

7 Estimation cost for production 469.000.000 294.000.000 434.000.000 539.000.000 357.000.000 378.000.000

8 Payment Estimation 234.500.000 381.500.000 364.000.000 486.500.000 448.000.000 367.500.000

9 50% 234.500.000 147.000.000 217.000.000 269.500.000 178.500.000 189.000.000

PAYMENT PLAN

No. Targets August September October November DecemberJanuary next

year1 Estimated Turnover 770.000.000 440.000.000 660.000.000 880.000.000 550.000.000 660.000.000

2 Buying products 67.000 42.000 62.000 77.000 51.000 54.000

3 Estimated payment (6+8) 342.300.000 443.100.000 456.400.000 702.400.000 525.000.000 459.900.000

4 - For one unit 7.000 7.000 7.000 7.000 7.000 7.000

5 - Totol cost for production 469.000.000 294.000.000 434.000.000 539.000.000 357.000.000 378.000.0006 - Paid for seller 234.500.000 381.500.000 364.000.000 486.500.000 448.000.000 367.500.000

7 50% 234.500.000 147.000.000 217.000.000 269.500.000 178.500.000 189.000.000

8 - Management Cost 107.800.000 61.600.000 92.400.000 123.200.000 77.000.000 92.400.000

9 Expense and receipts balance (1-3) 427.700.000 (3.100.000) 203.600.000 177.600.000 25.000.000 200.100.000

10 Finance:

11 - Pay loans 92.700.000

12 Surplus amount in the end of term 427.700.000 (3.100.000) 203.600.000 84.900.000 25.000.000 200.100.000

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GaMBA01.X0210 Management Accountant

In fact:

ACTUAL SALES

No. Targets August September October November December January next year1 Selling quantity 70.000 40.000 60.000 80.000 50.000 60.000

2 Selling price 11.000 11.000 11.000 11.000 11.000 11.000

3 Turnover(1x2) 770.000.000 440.000.000 660.000.000 880.000.000 550.000.000 660.000.000

4 Amount receipts 616.000.000 506.000.000 616.000.000 836.000.000 616.000.000 638.000.000

5 80% 616.000.000 352.000.000 528.000.000 704.000.000 440.000.000 528.000.000

6 20% 154.000.000 88.000.000 132.000.000 176.000.000 110.000.000 132.000.000

ACTUAL PAYMENT

No. Targets August September October November DecemberJanuary next

year

1 Turnover 770.000.000 440.000.000 660.000.000 880.000.000 550.000.000 660.000.0002 Quantity of production 67.000 42.000 62.000 77.000 51.000 54.000

3 Actual payment: 107.800.000 530.600.000 386.400.000 649.900.000 616.000.000 449.400.000

4 - For one unit 7.000 7.000 7.000 7.000 7.000 7.000

5 - Total cost for production 469.000.000 294.000.000 434.000.000 539.000.000 357.000.000 378.000.000

6 - Must pay for seller 469.000.000 294.000.000 434.000.000 539.000.000 357.000.000

8 - Management cost 107.800.000 61.600.000 92.400.000 123.200.000 77.000.000 92.400.000

9 Expense and receipts balance (1-3) 662.200.000 (90.600.000) 273.600.000 230.100.000 (66.000.000) 210.600.000

10 Finance:

11 - Pay loans 92.700.000

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12 Surplus amount in the end of term 662.200.000 (90.600.000) 273.600.000 137.400.000 (66.000.000) 210.600.000

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