[Solution]Direct Material Budget

Provide numerical examples of a Direct Material Budget for the second quarter (April to June) by considering a manufacturing company operating in Saudi Arabia as…

Provide numerical examples of a Direct Material Budget for the second quarter (April to June) by considering a manufacturing company operating in Saudi Arabia as a sample study. (2marks)

 
 

XYZ Industries Co. decided to allocate Human Resource department costs based on the number of employees in each department and Information Technology costs based on the number of machine hours in each department. (2marks)

Required:

Give a numerical example for the four departments, given the table below, (the numerical information should be appropriate as per the table given as a reference.

 

 
Support Departments
Operating Departments
TOTAL

Human Resource
Information Technology
Hot Rolled Hollow Steel 
cold Rolled Hollow Steel

Total department cost
 
 
 
 
 

Number of employees
 
 
 
 
 

Number of machine hours
 
 
 
 
 

 
b- Then based on your given information, use The Direct method to allocate support department costs.
 
Allocate cost:

Human Resource
 
 
 
 
 

Information Technology
 
 
 
 
 

 
 
 
 
 
 

TOTAL
 
 
 
 
 

 

For what types of products is the physical output method appropriate? Give suitable and real example that should support your answer. (1mark)

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