GaMBA01.

X0210 Management Accountant

FINAL EXAM
SUBJECT: MANAGEMENT ACCOUNTANT
NAME: VŨ VĂN HẬU
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
Quantity of sold goods:
Quantity of sold goods
August 70.000
September 40.000
October 60.000
November 80.000
December 50.000
January of the next year 60.000

50% of intake goods will be paid in buying month and the balance will be
paid in the next month.
Average expenditure for one intake unit is 7.000 VND.
Reserve at the end of month will be at: 2.000 units + 10% output which
will be sole in the following month.
Estimated management cost for each month is 14% of turnover and will be
paid in month of arising cost.

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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.

ANSWER
Question 1: Formulate budget for the fourth Quarter
a. Sales budget:
We have:
 Expectation quantitiy of selling goods: (Unit)
August : 70.000
September : 40.000
October : 60.000
November : 80.000
December : 50.000
 Expectation turnover will be implemented in month respectively is (Unit:
1.000 VND)
August : 70.000x11= 770.000
September : 40.000x11= 440.000
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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 December
1 Quantity of selling goods 60.000 80.000 50.000
2 Selling price 11.000 11.000 11.000
Turnover will be carried out
3 (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

b. Goods Supply Budget:

No. Targets October November December
Quantity of products need to be
1 sole 60.000 80.000 50.000
Quantity of products need to be
2 reserved in the end of term 10.000 7.000 8.000
3 Stored quantity in the first term 8.000 10.000 7.000
4 Quantity need buying (1+2-3) 62.000 77.000 51.000
5 Cost:
6 - For one unit 7.000 7.000 7.000
7 Cost Estimation for products 434.000.000 539.000.000 357.000.000
8 Estimated amount must be paid 364.000.000 486.500.000 448.000.000
9 50% 217.000.000 269.500.000 178.500.000
Expectation quantity of goods need buying in each month is:
- October: 62.000
- November: 77.000
- December: 51.000

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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
660.000.00
1 Expected Turnover 0 880.000.000 550.000.000
2 Buying products 62.000 77.000 51.000
456.400.00
3 Expected payment (6+8) 0 702.400.000 525.000.000
4 - For one unit 7.000 7.000 7.000
- Total cost for production of 434.000.00
5 goods 0 539.000.000 357.000.000
364.000.00
6 - Paid for seller 0 486.500.000 448.000.000
217.000.00
7 50% 0 269.500.000 178.500.000
8 - Management cost 92.400.000 123.200.000 77.000.000
Expense and receipts balance (1- 203.600.00
9 3) 0 177.600.000 25.000.000
10 Finance:
11 - Pay loan 92.700.000
203.600.00
12 Surplus amount in the end of term 0 84.900.000 25.000.000

We have plan for paying seller:

- October: 364.000.000 (VND)
- November: 486.500.000 (VND)
- December: 448.000.000 (VND)
Payment plan = Paying for seller + Management cost + paying loans
- October: 456.400.000 (VND)
- November: 702.400.000 (VND)
- December: 525.000.000 (VND)

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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 50.000
2 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)
Compare with expectation:
- October: 555.500 (VND)
- November: 737.000 (VND)
- December: 643.500 (VND)
=> Therefore, except December, compare with receipt expectation, the
Company will get back more money than expected (the bigger quantity of
products is sole, the more difference is)
b. Goods supply budget:
No Targets October November December
1 Selling Turnover 660.000.000 880.000.000 550.000.000
2 Quantity of prodution 62.000 77.000 51.000
3 Actual expense: 386.400.000 649.900.000 616.000.000
4 - For one unit 7.000 7.000 7.000
5 - Total cost for production 434.000.000 539.000.000 357.000.000
6 - Payment for Seller 294.000.000 434.000.000 539.000.000
8 - Management Cost 92.400.000 123.200.000 77.000.000
9 Expense and receipts balance (1- 273.600.000 230.100.000 (66.000.000)

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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.
c. Actual payment:
Payment in month = Paying for seller + Management cost + paying loans
- October: 386.400.000 (VND)
- November: 649.900.000 (VND)
- December: 616.000.000 (VND)
Compare with the plan
- October: 456.400.000 (VND)
- November: 702.400.000 (VND)
- December: 525.000.000 (VND)
=> Therefore, except December, compare with expectation, the Company
will must pay for each month fewer.
Question 3: Analyzing factors affecting budgeting:
a. Sale budgeting:

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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
company’s 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 functional
departments 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.
b. Budgeting for goods supply:
Payment methods for suppliers directly affect sales budgeting:
- When suppliers are in difficulties (financial problems): the company cannot
enjoy longer credit term, even has to pay in advance or immediately, then the
company has to plan for a larger budget for suppliers.
- Vice verse, when suppliers are in favorable conditions, the company can
enjoy longer credit term, then the budget for suppliers will be less.
c. Budget planning:
- Total money in budget will differ when there is a change in
monthly payment for suppliers.
- When there is a change in sales, revenues will change
accordingly, which results in the company’s budget.
- When the company is unable to meet monthly payment
requirements, the company has to raise debt which will be paid
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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 BUDGET
No. Targets August September October November December January next year
1 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

January next
No. Targets August September October November December year
1 Quantity of products need selling 70.000 40.000 60.000 80.000 50.000 60.000
Quantity of products need
2 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
January next
No. Targets August September October November December year
1 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 469.000.000 294.000.000 434.000.000 539.000.000 357.000.000 378.000.000
6 - 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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In fact:

ACTUAL SALES
No. Targets August September October November December January next year
1 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
January next
No. Targets August September October November December year
1 Turnover 770.000.000 440.000.000 660.000.000 880.000.000 550.000.000 660.000.000
2 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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