What is Zero Based Budgeting? Objective of Budgeting .

(10)
The following are the balance sheets of ‘X ltd’ & ‘Y ltd’. for the year ending 31st of December 2007. (10)
Liabilities X ltd Y ltd Assets X ltd Y ltd

Equity Share 250,000 170,000 Land & Building 350,000 275,000

Preference share 120,000 80,000 Plant & Machine 270,000 300,000
Reserve 50,000 70,000 Investment 72000 12000
Loans 350,000 279,000 Book debts 47500 25000
Bills payable 25000 14000 Prepaid expenses 35400 ------
Sundry creditors 18000 8000 Cash & Bank 48690 21000
Outstanding exp. 8590 4500
Dividend declared 2000 7500

823,590 633,000 823,590 633,000

Present the data in such a way that proper analysis is possible.

3. A company expects to have rs.20,000 in bank on 1st May, 2013 and requires you to prepare estimate of cash position during the three months May, June & July,
2013. (10)
The following information is provided by the Management:
Months Sales (rs.) Purchase (rs.) Wages (rs.) Office exp. (rs.) Factory exp. (rs.) Selling exp. (rs.)
March 40,000 24,000 4800 3200 4000 2400
April 44,800 25,600 5200 3200 4400 2400
May 48,000 28,000 5600 3200 4400 2400
June 64,000 32,000 7200 3200 6000 3600
July 72,000 32,000 7600 3200 6400 3600
In addition the company also discloses some policy related information which may be required preparing the estimate of cash position other information.
I. 20% of sales are in cash, remaining amount is collected in the month following that of sales.
II. Suppliers supply goods at two months credit.
III. Wages and all other expenses are paid on the month following the one in which they are incurred.
IV. The company pays dividends to shareholders and bonus to workers of Rs. 8,000 and Rs. 12,000 respectively in the month of may.
V. Plant has been ordered and is expected to be received in June. It will cost Rs. 64,000 and will paid in June.
VI. Income Tax Rs. 20,000 is payable in July.

What is Zero Based Budgeting? Objective of Budgeting. (10)

The following are the balance sheets of ‘X ltd’ & ‘Y ltd’. for the year ending 31st of December 2007. (10)
Liabilities X ltd Y ltd Assets X ltd Y ltd

Equity Share 250,000 170,000 Land & Building 350,000 275,000

Preference share 120,000 80,000 Plant & Machine 270,000 300,000
Reserve 50,000 70,000 Investment 72000 12000
Loans 350,000 279,000 Book debts 47500 25000
Bills payable 25000 14000 Prepaid expenses 35400 ------
Sundry creditors 18000 8000 Cash & Bank 48690 21000
Outstanding exp. 8590 4500
Dividend declared 2000 7500

823,590 633,000 823,590 633,000

Present the data in such a way that proper analysis is possible.

3. A company expects to have rs.20,000 in bank on 1st May, 2013 and requires you to prepare estimate of cash position during the three months May, June & July,
2013. (10)
The following information is provided by the Management:
Months Sales (rs.) Purchase (rs.) Wages (rs.) Office exp. (rs.) Factory exp. (rs.) Selling exp. (rs.)
March 40,000 24,000 4800 3200 4000 2400
April 44,800 25,600 5200 3200 4400 2400
May 48,000 28,000 5600 3200 4400 2400
June 64,000 32,000 7200 3200 6000 3600
July 72,000 32,000 7600 3200 6400 3600
In addition the company also discloses some policy related information which may be required preparing the estimate of cash position other information.
I. 20% of sales are in cash, remaining amount is collected in the month following that of sales.
II. Suppliers supply goods at two months credit.
III. Wages and all other expenses are paid on the month following the one in which they are incurred.
IV. The company pays dividends to shareholders and bonus to workers of Rs. 8,000 and Rs. 12,000 respectively in the month of may.
V. Plant has been ordered and is expected to be received in June. It will cost Rs. 64,000 and will paid in June.
VI. Income Tax Rs. 20,000 is payable in July.