[The following information applies to..the que.stions displayed below.]"" ······· ······· ······· ······· ······· ······· ······· ······· ······· ······· ······· ······· ······· ······· ······· ······· ······· ······· ···
Midwest Products is a wholesale distributor of leaf rakes. Thus, peak sales occur in August of each year
as shown in the company's sales budget for the third quarter, given below:
Budgeted sales (all on account)
July
August
September
$600,000
$ 900,000
$500,000
Total
$2,000,000
From past experience, the company has learned that 20% of a month's sales are collected in the month
of sale, another 70% are collected in the month following sale, and the remaining 10% are collected in
the second month following sale. Bad debts are negligible and can be ignored. May sales totaled
$430,000 , and June sales totaled $540,000.
1.
value:
10.00 points
Required:
1. Prepare a schedule of expected cash collections from sales, by month and in total, for the third
quarter. (Do not round intermediate calculations. Leave no cells blank - be certain to enter "0"
wherever required. Omit the "$" sign in your response.)
Schedule of Expected Cash Collections
July
August
September
May sales
June sales
July sales
August sales
$ :=1= =
43=oo=:
ol
378000
120000
September sales
1-----~-~l
Total cash collections
check my work
2.
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$1
18000~
541000 1
•
View Hint #1
ol
54000
420000
I
654000 1
1~ 1
$I
I
.
ol
oI
60000
~~~~~~
790000 1
Total
43ooo I
$1
l=====l
432000
600000
810000
100000
1985000 1
references
value:
10.00 points
····· ······ ······ ······ ... i
·Assu.me thaftFie.co.mi:iany.wilfprepare a·bud9.eted &aiance.sh.eetas of september 3o: c·omi:iute.the ·
accounts receivable as of that date. (Do not round intermediate calculations. Omit the "$" sign in
your response.)
Total accounts receivable
check my work
~ eBook Link
$ 1.__4
. .:.9--=-. : oo:. .o.:....J
: .o I
.a View Hint #1
r ~ I references
3.
value:
10.00 points
direct 1abor bud9et
··· ···· ···· ···· ···· ttie
a Krlspln corporation tor. the i.ipcomln9 fiscal· year inCludes thefoilowing ··· ................................................................................................................................
budgeted direct labor-hours.
1st Quarter
5,000
Budgeted direct labor-hours
2nd Quarter
4,800
3rd Quarter
5,200
4th Quarter
5,400
The company's variable manufacturing overhead rate is $1.75 per direct labor-hour and the
company's fixed manufacturing overhead is $35,000 per quarter. The only noncash item included in fixed
manufacturing overhead is depreciation , which is $15,000 per quarter.
Required:
1. Complete the company's manufacturing overhead budget for the upcoming fiscal year. (Input all
amounts as positive values. Omit the "$" sign in your response.)
Krispin Corporation
Manufacturing Overhead Budget
Variable manufacturing overhead
$
2nd
1st
Quarter
8750
$
Quarter
8400
3rd
$
Quarter
9100
$
4th
Quarter
9450
1--------l
Fixed manufacturing overhead
35000
35000
35000
35000
Total manufacturing overhead
Less depreciation
43750 1
43400 1
44100 1
15000 1
15000 1
15000 1
44450 1
15000 1
29100 1
$ ,_1---=2=-=94--=5.0:. . 1~
Cash disbursements for
manufacturing overhead
$1
28750 1
$1
28400 1
$1
2. Compute the company's manufacturing overhead rate (including both variable and fixed
manufacturing overhead) for the upcoming fiscal year. (Round your answer to 2 decimal places.
Omit the "$" sign in your response.)
Predetermined manufacturing overhead rate
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View Hint #1
$ .L-1_ _8_.6___.
11
l ~ l references
Year
$
35700
1--------l
140000
175700 1
60000 1
$ ,_1_
_:_:
11_:_:
57--=o~
o1
4.
value:
10.00 points
··- . ..... ..... ..... ..... ....................... ......... . ............. .... ................... ..... ..... ..... ..... ......... ········
"
. ..... .......... ................. ..... ..... .... ······ ......... ........... ... . ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... .... ····-
The budgeted unit sales of Haerve Company for the upcoming fiscal year are provided below:
1st Quarter
12,000
Budgeted unit sales
2nd Quarter
14,000
3rd Quarter
11 ,000
4th Quarter
10,000
The company's variable selling and administrative expenses per unit are $2.75. Fixed selling and
administrative expenses include advertising expenses of $12,000 per quarter, executive salaries of
$40,000 per quarter, and depreciation of $16,000 per quarter. In addition ,. the company will make
insurance payments of $6,000 in the 2nd Quarter and $6,000 in the 4th Quarter. Finally, property taxes
of $6,000 will be paid in the 3rd Quarter.
Required:
Prepare the company's selling and administrative expense budget for the upcoming fiscal year. (Input all
amounts as positive values. Leave no cells blank ·be certain to enter "0" wherever required. Omit
the"$" sign in your response.)
Haerve Company
Selling and Administrative Expense Budget
1st
2nd
Quarter
Quarter
IVariable selling and administrative expenses
Fixed selling and administrative expenses:
Advertising
Executive salaries
Insurance
Property taxes
Depreciation
•I
$1
•
•
•
•
•
Total fixed selling and administrative expenses
Total selling and administrative expenses
ILess depreciation
·I
Cash disbursements for selling and administrative expenses
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~
View Hint #1
t ~ 1 references
$1
33000 1
$1
38500 1
3rd
Quarter
$1
4th
Quarter
30250 1
$1
Year
27500 1
$1
129250 1
12000
12000
12000
12000
48000
40000
40000
40000
40000
160000
0
6000
0
6000
12000
0
0
6000
0
6000
16000
16000
16000
16000
64000
68000 1
74000 1
74000 1
74000 1
290000 1
101000 1
112500 1
104250 1
101500 1
419250 1
16000 1
16000 1
16000 1
16000 1
64000 1
85ooo l
$1
96500 1
$1
88250 1
$1
855oo l
$1
355250 1
5.
value:
10.00 points
...............................................................................................................................................................................................................................................................................
Micro Products, Inc., has developed a very powerful electronic calculator. Each calculator requires three
small "chips" that cost $2 each and are purchased from an overseas supplier. Micro Products has
prepared a production budget for the calculator by quarters for Year 2 and for the first quarter of Year 3,
as shown below:
Budgeted production, in calculators
First
60,000
Year2
Second
Third
90,000 150,000
Fourth
100,000
Year3
First
80,000
The chip used in production of the calculator is sometimes hard to get, so it is necessary to carry large
inventories as a precaution against stockouts. For this reason, the inventory of chips at the end of a
quarter must equal 20% of the following quarter's production needs. A total of 36,000 chips will be on
hand to start the first quarter of Year 2.
Required :
Prepare a direct materials budget for chips, by quarter and in total, for Year 2. (Do not round
intermediate calculations. Input all amounts as positive values. Omit the "$" sign in your
response.)
Required production in calculators
Number of chips per calculator
Micro Products, Inc.
Direct Materials Budget- Year 2
Quarter
First
Second
90000 1
6oooo l
I
3
3
X
Production needs- chips
j Add
• I:IEnding inventory
•I
Required purchases- chips
$1
48000 1
1248000 1
360000 1
510000 1
348000 1
36000 1
54000 1
90000 1
6oooo l
198000 1
306000 1
420000 1
$1
612000 1
31
1200000
48000 1
234000 1
396000 1
Year
400000 1
300000
90000 1
• I:IBeginning inventory · I
Total cost of purchases
Fourth
100000 1
3
270000
Total needs
IDeduct
Third
150ooo l
3
$I
840000 1
36000 1
1212000 1
288000 1
$1
576000 1
$1
2424000 1
6.
value:
10.00 points
ciystai tefecom .. has bui:lgetecfthe saies ofhs innovative mobWe phone over
follows:
the
nexftour mori.ths as
Sales in Units
30,000
45,000
60,000
50,000
July
August
September
October
The company is now in the process of preparing a production budget for the third quarter. Past
experience has shown that end-of-month finished goods inventories must equal 10% of the next month's
sales. The inventory at the end of June was 3,000 units.
Required:
Prepare a production budget for the third quarter showing the number of units to be produced each
month and for the quarter in total. (Do not round intermediate calculations. Input all amounts as
positive values.)
Crystal Telecom
Production Budget
Jul~
Budgeted sales in units
j Add
I
~ 1: Ending inventory
I
~ 1: Beginning inventory
Required production in units
Se~tember
Quarter
~I
45000 1
6ooo l
60000 1
5ooo l
135000 1
5ooo l
~I
34500 1
3000 1
51000 1
4500 1
65000 1
6ooo l
140000 1
3000 1
31500 1
46500 1
59000 1
137000 1
Total needs
IDeduct
August
30000 1
4500 1
7.
value:
10.00 points
caCis·
seattle
the wholes<ile distributor ofa ·smali" recreational· catamaran saiihoat: Managemenfhcis ..
prepared the following summary data to use in its annual budgeting process:
Budgeted unit sales
Selling price per unit
Cost per unit
Variable selling and administrative expenses (per
unit)
Fixed selling and administrative expenses (per year)
Interest expense for the year
380
$ 1,850
$ 1,425
$85
$ 105,000
$11,000
Required:
Prepare the company's budgeted income statement using an absorption income statement format shown
below. (Input all expense amounts as positive values. Omit the "$" sign in your response.)
Seattle Cat
Budgeted Income Statement
[COSt of goods sold
•
I
$ ~I===
7o=3o=o~
o1
I
5415oo I
IGross margin
•
I
161500 1
ISelling and administrative expenses
•
I
137300 1
I
• I
24200 1
~~S
ales--------------------.~1
INet operating income (loss)
IInterest expense
INet income (loss)
•
11000 1
$
1_32_o__,
o
, _ 1_ _
I
8.
value:
10.00 points
Colerain Corporation is a merchandising company that is preparing a profit plan for the third quarter of
the calendar year. The company's balance sheet as of June 30 is shown below:
Colerain Corporation
Balance Sheet
June 30
Assets
Cash
Accounts receivable
Inventory
Plant and equipment, net of depreciation
$ 80,000
126,000
52,000
200,000
Total assets
$458,000
Liabilities and Stockholders' Equity
Accounts payable
Common stock
Retained earnings
$ 61 ,100
300,000
96,900
Total liabilities and stockholders' equity
$458,000
Colerain's managers have made the following additional assumptions and estimates:
1. Estimated sales for July, August, September, and October will be $200,000, $220,000, $210,000, and
$230,000 , respectively.
2. All sales are on credit and all credit sales are collected. Each month's credit sales are collected 30%
in the month of sale and 70% in the month following the sale. All of the accounts receivable at June
30 will be collected in July.
3. Each month's ending inventory must equal 40% of the cost of next month's sales. The cost of goods
sold is 65% of sales. The company pays for 50% of its merchandise purchases in the month of the
purchase and the remaining 50% in the month following the purchase. All of the accounts payable at
June 30 will be paid in July.
4. Monthly selling and administrative expenses are always $65,000. Each month $5,000 of this total
amount is depreciation expense and the remaining $60,000 relates to expenses that are paid in the
month they are incurred.
5. The company does not plan to borrow money or pay or declare dividends during the quarter ended
September 30. The company does not plan to issue any common stock or repurchase its own stock
during the quarter ended September 30.
Required:
1. Prepare a schedule of expected cash collections for July, August, and September. Also compute total
cash collections for the quarter ended September 30th. (Do not round intermediate calculations.
Leave no cells blank • be certain to enter "0" wherever required. Omit the "$" sign in your
response.)
Schedule of Expected Cash Collections
A ugust
Septem ber
$
126000 1
0
$
0
140000
0
6000~ 1
154000
66000
0
63000
ol
Q uarter
JU)'
I
From accounts receivable
From July sales
From August sales
From September sales
$1
I
I
Total cash collections
186000 1
206000 1
$1
I
126000 1
200000
220000
63000 1
609000 1
217000 1
2a. Prepare a merchandise purchases budget for July, August, and September. Also compute total
merchandise purchases for the quarter ended September 30th. (Input all amounts as positive
values. Do not round intermediate calculations. Omit the "$" sign in your response.)
Merchandise Purchases Budget
Jul)'
August
130000 1
143000 1
$1
$1
Budgeted cost of goods sold
• II Ending inventory
I Add:
·I
" II Beginning inventory
I Deduct:
136500 1
$1
Total
409500 1
54600 1
I
59800 1
I
59800 1
187200 1
197600 1
I
196300 1
469300 1
52000 1
57200 1
I
54600 1
52000 1
140400 1
$1
141700 1
I
'f l
Required purchases
I
57200 1
Total needs
135200 1
$1
Se~tember
$I
$1
2b. Prepare a schedule of expected cash disbursements for merchandise purchases for July, August,
and September. Also compute total cash disbursements for merchandise purchases for the quarter
ended September 30th. (Do not round intermediate calculations. Leave no cells blank - be
certain to enter "0" wherever required. Omit the "$" sign in your response.)
Schedule of Expected Cash Disbursements-Merchandise Purchases
August
July
Se~tember
$
0
From accounts payable
$
1
ol
$ 1==,;;,
6 11,.;;,
,;.. 09
0
67600
For July purchases
67600
For August purchases
0
70200
I
I
For September purchases
I
7o85o 1
7020~
Total cash disbursements
128700 1
137800 1
141050 1
3. Prepare an income statement for the quarter ended September 30th. (Input all amounts as positive
values except losses which should be indicated by a minus sign. Do not round intermediate
calculations. Leave no cells b lank· be certain to enter "0" wherever required. Omit the "$" sign
in your response.)
Colerain Corporation
Income Statement
For the Quarter Ended September 30
•I
·I
! Sales
[CO"st of goods sold
$1
630000 1
I
409500 1
•]
( Gross margin
~lling and administrative expenses
220500 1
TJ
( Net operating income (loss)
l lnterest expense
"'•]
[ Net income (loss)
•I
195000]
I
c
$l
25500 1
ol
25500]
4. Prepare a balance sheet as of September 30th . (Be sure to list the assets and liabilities in order
of their liquidity. Do not round intermediate calculations. Omit the"$" sign in your response.)
Colerain Corporation
Balance Sheet
September 30
Assets
7J
[ cash
$[
101450 1
( Acco_u_n-:ts- r-ec-e-:iv-a-:-:
ble
[
147000]
[Plant and equipment, net
u nventory
[-
185,000
59,800
$[
Total assets
j
493250 ]
Liabilities and Stockholders' Equity
(Accounts payable
7Q85Ql
( Capital stock
300000]
( Retained earnings
1224Q6l
Total liabilities and stockholders' equity
493250 ]
Total
$ 1==,;;,
6 11,.;;,
.;.. 09
0
135200
140400
70850 1
407550 1
$1
417300 1
[The following information applies to the questions display ed bel o w) ·······································································································································································································
The production manager of Junnen Corporation has submitted the following forecast of units to be
produced for each quarter of the upcoming fiscal year.
Units to be produced
1st Quarter 2nd Quarter 3rd Quarter 4th Quarter
5,000
4,400
4,500
4,900
Each unit requires 0.40 direct labor-hours and direct labor-hour workers are paid $11 per hour.
9.
value:
10.00 points
·· Reciuire&
1. Complete the company's direct labor budget for the upcoming fiscal year, assuming that the direct
labor workforce is adjusted each quarter to match the number of hours required to produce the
forecasted number of units produced. (Omit the "$" sign in your response.)
Total direct labor hours needed
Total direct labor cost
check my work
1Q•
~ eBook link
1st
Quarter
2000
22000
$
View Hint #1
1~J
Junnen Corporation
Direct Labor Budget
2nd
Quarter
$1
1760 1
19360 :
3rd
Quarter
1800
19800
$
4th
Quarter
1960
Year
7520
$ ~=,:...:
82::.:,.7-=,
20;d
references
value:
10.00 points
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~
~
2. Complete the company's direct labor budget for the upcoming fiscal year, assuming that the direct
labor workforce is not adjusted each quarter. Instead, assume that the company's direct labor
workforce consists of permanent employees who are guaranteed to be paid for at least 1,800 hours of
work each quarter. If the number of required direct labor-hours is less than this number, the workers
are paid for 1,800 hours anyway. Any hours worked in excess of 1,800 hours in a quarter are paid at
the rate of 1.5 times the normal hourly rate for direct labor. (Leave no cells blank • be certain to
enter "0" wherever required. Omit the "$" sign in your response.)
1st
Quarter
Total direct labor hours needed
Regular hours paid
E=
Overtime hours paid
l
2000 1
1800
200 ]
Wages for regular hours
Overtime wages
$ t-
19800J
3300
Total direct labor cost
$ r-=
23100]
Junnen Corporation
Direct Labor Budget
2nd
Quarter
t=
17~
1800
l
$[
1980~]
$[ -
19800J
OJ
3rd
Quarter
E= ~
1800
4th
Quarter
t=
19~
1800
Year
E=
7520 1
7200
oJ
l
16o]
$t-
1980~]
$~
1980~]
$ t-
79200]
5940
$ r-=
19800l
$L
22440J
$~
85140l
l
2640
l
360]
11 .
value:
10.00 points
The management of Academic Copy, a photocopying center located on University Avenue, has compiled
the following data to use in preparing its budgeted balance sheet for next year:
Ending
Balances
?
Cash
Accounts receivable
Supplies inventory
$ 6,500
$ 2,100
$ 28,000
Equipment
$ 9,000
$ 1,900
$ 4,000
Accumulated depreciation
Accounts payable
Common stock
Retained earnings
?
The beginning balance of retained earnings was $21 ,000, net income is budgeted to be $8,600, and
dividends are budgeted to be $3,500.
Required:
Prepare the company's budgeted balance sheet. (Be sure to list the assets and liabil ities in order of
their liquidity. Amounts to be deducted s hould be indicated with minus sign. Omit t he"$" sign in
your response.)
Academic Copy
Budgeted Balance Sheet
Assets
Current assets:
4400 1
$ ~1====~
ICash
IAccounts receivable
ISupplies inventory
Total current assets
Plant and equipment:
IEquipment
IAccumulated depreciation
I
65oo l
2100 1
$I
I
., I
.,
13000 1
28000 1
-9ooo 1
Plant and equipment, net
19000 1
Total assets
$I
32000 1
$I
1900 1
Liabilities and Stockholders' Equity
Current liabilities:
IAccounts payable
..
,
Stockholders' equity:
ICommon stock
IRetained earnings
.. I
.. I
4000 1
26100 1
Total stockholders' equity
Total liabilities and stockholders' equity
30100 1
$1
32000 1
12.
value:
10.00 points
······················································-·············································································································································································································································· ...........................................................................................................................................................................................
Forest Outfitters is a retailer that is preparing its budget for the upcoming fiscal year. Management has
prepared the following summary of its budgeted cash flows:
Total cash receipts
Total cash disbursements
1st Quarter
$340,000
$530,000
2nd Quarter
$670,000
$450,000
3rd Quarter
$410 ,000
$430,000
4th Quarter
$470,000
$480 ,000
The company's beginning cash balance for the upcoming fiscal year will be $50,000. The company
requires a minimum cash balance of $30,000 and may borrow any amount needed from a local bank at a
quarterly interest rate of 3% . The company may borrow any amount at the beginning of any quarter and
may repay its loans, or any part of its loans, at the end of any quarter. Interest payments are due on any
principal at the time it is repaid .
Required :
Complete the company's cash budget for the upcoming fiscal year. (Input all amounts as positive
values except cash deficiency, repayments, and interest, which should be indicated by a minus
sign . Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your
response.)
Cash balance, beginning
Total cash receipts
Forest Outfitters
Cash Budget
1st Quarter
2nd Quarter
$
30000
$
50000
670000
340000
Total cash available
Less total cash disbursements
Excess (deficiency) of cash available over disbursements
Financing:
Borrowings (at beginning)
Repayments (at ending)
Interest
Cash balance, ending
$
4th Quarter
49800
470000
700000 1
450000 1
479800 1
430000 1
519800 1
480000 1
-14oooo 1
250000 1
49800 1
39800 1
~I
170000 1
$1
3rd Quarter
69800
410000
390000 1
530000 1
170000 1
Total financing
$
30000 1 $ 1
ol
-170000
-10200
ol
ol
-18o2oo 1
ol
ol
69800 1 $ 1
~I
49800 1 $ 1
$
1940000
1890000
5oooo l
170000
-170000
-10200
~I
39800 1
Year
50000
1890000
-1o2oo I
$1
39800 1
•
120 out of 120 points (100%)