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Accounts For Small Business Essay

3175 words - 13 pages

List of tables
Table 1- Cost per unit……………………………………………………………. 9
Table 1.1- Materials usage budget…………………………………………….. 10
Table 1.2- Production budget…………………………………………………… 11
Table 1.3- Sales budget…………………………………………………………. 12
Table 1.4- Cash budget………………………………………………………….. 13
Table 1.5- Income statement……………………………………………………. 14
Table 1.6- Balance sheet………………………………………………………… 15
Table 1.7- Break-even analysis chart and table………………………………. . 16

Introduction
Stacy’s will set up and operate as a Sole trader business in Montrose, Chaguanas with a capital of $300,000.00. This location was chosen because Chaguanas is in the heart of Trinidad; it targets consumers in the North, South and the ...view middle of the document...

00 at one yard, string for $1.00 at two yards and vamp or upper for $80.00 at half yard. After calculating that cost a 60% mark up was added in order to make a profit bringing the total cost at selling a pair of shoe at $288.00. (See appendix 1).
Materials usage budget
In this budget the amount of materials Stacy’s will be using to produce the quantity of 1900 pair of shoes is calculated using the cost for one pair of shoe at $288.00. (See appendix 2).
Production budget
This budget shows that the actual cost to produce 1900 pair of shoes using all the materials for the month and the entire year at total at a projected figure of $342,000.00. (See appendix 3)
Sales budget
This is a budget forecasting how much Stacy’s sales will be selling 1900 pair of shoes for the year using the materials per cost and the cost per pair of shoe with a projected figure of $547,200.00. (See appendix 4)

Cash Budget
After preparing previously my cost per pair of shoe and how much materials it would require to make each pair of shoe together with how much my predicted sales for the year would turn out to be, the cash budget (see appendix 5) was prepared using figures from appendix 1-4. With a capital of $300,000.00 and my projected sales at $547,200.00 (see appendix 4) Stacy’s total receipts was calculated to be $847,200.00. The sales figure was calculated using a varying quantity of shoes to be sold each month as January and February month shoes being sold at 200 pairs each due to the fact that January being the first month in the year consumers like to go out to work or school or even to go out with their families looking stunning since it being a new year and February being the month for Valentine’s Day, customers like to go out to fancy dinners and cocktail parties and of course they want to look ravishing for their loved one and also people also buy gifts as their token of appreciation in this month so they buy what most women want “shoes” hence Stacy’s will be producing more shoes for these months.
Also during these months advertising will be at a higher cost of $400.00 compared to the other months where production will be slower at $200.00, due to the occasions and also for promoting purposes. In the month of January being the month Stacy’s will be opening, a machine at a cost of $5,000.00 that will be used to make the shoes, a computer costing $1,500.00 was purchased for this price because as we all know the world today is swamped with technology so bargaining for this price was not hard which will be used to record the company’s transactions and to do the accounting procedures, a vehicle valued at $30,000.00 to carry out all orders and bring in supplies and to do banking with an insurance costing $600.00 for a one year period will be bought and fixtures and fittings at a cost of $10,000.00 which will be covering painting, plumbing, wiring, furniture will be entered under payments. Another cost standard each month is rent at $2,000.00, electricity...

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