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1. S.K. SUPPLIERS : PRODUCTION
OF LARRY HAIR SERUM
Presented By:
Chetana Mishra

2. INTRODUCTION
• S.K Suppliers Pvt. Ltd produces the cosmetic items and distributes its
product all over the country.
• Basically, the company is associated with the brand ‘Larry’ which is
renowned for cosmetic product.
• The company sells its products to the retail shops like cosmetic shops
and beauty parlours and also to the wholesale dealers over the country.

3. PRODUCTION
• The S.K. Suppliers produces ‘Larry Hair Serum’.
• Required raw materials:
• Panthenol- vitamin B5
• Jojoba oil- moisturizer
• Silk protein- shining agent

4. SALES BUDGET
Month Jan Feb Mar Apr May June
Sales Unit 1000 1500 2000 2500 3000 3500
SP/Unit 25 25 25 25 25 25
Sales in (Rs) 25000 37500 50000 62500 75000 87500

5. PRODUCTION BUDGET
Month Jan Feb Mar Apr May June
Sales Unit 1000 1500 2000 2500 3000 3500
- Opening Stock 300 300 400 500 600 700
+ Closing Stock (20% of following
month) 300 400 500 600 700 800
Production Unit 1000 1600 2100 2600 3100 3600

6. MATERIAL CONSUMPTION
BUDGET
Month Jan Feb Mar Apr May June
Production Unit 1000 1600 2100 2600 3100 3600
Required unit of Panthenol @ 4 4000 6400 8400 10400 12400 14400
Required unit of Jojoba Oil @3 3000 4800 6300 7800 9300 10800
Required unit of Silk Protein
@2 2000 3200 4200 5200 6200 7200

7. MATERIAL BUDGET OF
PANTHENOL
Month Jan Feb Mar Apr May June
Material Consumption 4000 6400 8400 10400 12400 14400
- Opening Stock 800 1280 1680 2080 2480 2880
+ Closing Stock (20% of
following month sales) 1280 1680 2080 2480 2880 2880
Purchase in Unit 4480 6800 8800 10800 12800 14400
Purchase in Rs@3 13440 20400 26400 32400 38400 43200

8. MATERIAL BUDGET OF JOJOBA
OIL
Month Jan Feb Mar Apr May June
Material Consumption 3000 4800 6300 7800 9300 10800
- Opening Stock 600 960 1260 1560 1860 2160
+ Closing Stock (20% of
following month sales) 960 1260 1560 1860 2160 2200
Purchase in Unit 3360 5100 6600 8100 9600 10840
Purchase in Rs@2 6720 10200 13200 16200 19200 21680

9. MATERIAL BUDGET OF SILK
PROTEIN
Month Jan Feb Mar Apr May June
Material Consumption 2000 3200 4200 5200 6200 7200
- Opening Stock 400 640 840 1040 1240 1440
+ Closing Stock (20% of
following month sales) 640 840 1040 1240 1440 1500
Purchase in Unit 2240 3400 4400 5400 6400 7260
Purchase in Rs@1 2240 3400 4400 5400 6400 7260

10. CASH BUDGET
Cash Budget of SK
Suppliers January February March April May June Total
Cash In
Capital 150,000 150,000
Cash Sales(50%on cash) 12500 18750 25000 31,250 37,500 43,750 168,750
Collection(50%on credit) 6250 12500 18750 25,000 31250 37500 131,250
Loan 50000
Total In A 168,750 31,250 43,750 56,250 118,750 81,250 500,000
Cash out
Machinery 20,000 20,000
Vehicle expenses 80,000 80,000
Purchases 22,400 34,000 44,000 54,000 64,000 72,140 290,540
General expenses 1,500 1,500 1,500 1,500 1,500 1,500 9,000
Advertising expenses 2,000 2,000 2,000 2,000 2,000 2,000 12,000
Rent expenses 10,000 10,000 10,000 10,000 10,000 10,000 60,000
Total out B 135,900 47,500 57,500 67,500 77,500 85,640 471,540
Net Cashflow (A-B) 32,850 -16,250 -13,750 -11,250 41,250 -4,390 28,460
Opening balance 0 32,850 16,600 2,850 -8,400 32,850
Closing balance 32,850 16,600 2,850 -8,400 32,850 28,460

11. CONCLUSION
The company allow buyers a longer period of credit but the purchase are
made on cash only. So, the company should not purchase the raw
materials only on cash as the company should also apply the credit
purchase policy for positive net cash flow. Hence, the business need to
make arrangements for a possible overdraft or other way of financing the
deficit that is likely to occur during February and following months.