Answer the questions below regarding the bottoms-up budget summary displayed next Income Statement Budget 2,700,000 Sales...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Answer the questions below regarding the bottoms-up budget summary displayed next Income Statement Budget 2,700,000 Sales Per unit Casts Material 2.00 600,000 900,000 375,000 1,875,000 Labour 3.00 Overhead 1.25 COGS 6.25 Gross Margin 825,000 Selling and Adm in Costs 750,000 Operating Profit 75,000 Balance Sheet Budget Last year Cash 50,000 45,000 40,000 Material 60,000 102,500 Work in Process 40,000 125,000 Finished Goods 187,500 Fixed Assets 100,000 100,000 500,000 350,000 Debt 250,000 175,000 100,000 Com mon Stock 100,000 150,000 Retained Earnings 75,000 350,000 500,000 Data: • Sales in the budget are 300,000 units sold at $9 per unit • The per unit cost of material, labour and factory overhead are indicated above • Desired finished goods ending inventory is 30,000 units where beginning inventory was 20,000 units • Material used in in production in dollars is estimated at $620,000 • Desired material ending inventory is $60,000 where beginning inventory was $40,000 • Labour hours for production is estimated at 77,500 hours at $12 per hour • Factory overhead is estimated at $5 per labour hour worked • Beginning work in process inventory is $40,000 • Selling and administrative costs are $750,000 in the Budget Questions regarding the bottoms-up budget 1. Show the calculation of sales 2. Show the calculation of cost of goods sold (COGS) 3. How much material is purchased in the budget 4. What are total labour costs in the budget 5. What are total factory overhead costs in the budget 6. Show the development of work in process inventory in the budget 7. Show the development of the cost of finished goods inventory in the budget 8. What is a major driver of cash and, thus, should be an important execution goal coming out of the budget I Answer the questions below regarding the bottoms-up budget summary displayed next Income Statement Budget 2,700,000 Sales Per unit Casts Material 2.00 600,000 900,000 375,000 1,875,000 Labour 3.00 Overhead 1.25 COGS 6.25 Gross Margin 825,000 Selling and Adm in Costs 750,000 Operating Profit 75,000 Balance Sheet Budget Last year Cash 50,000 45,000 40,000 Material 60,000 102,500 Work in Process 40,000 125,000 Finished Goods 187,500 Fixed Assets 100,000 100,000 500,000 350,000 Debt 250,000 175,000 100,000 Com mon Stock 100,000 150,000 Retained Earnings 75,000 350,000 500,000 Data: • Sales in the budget are 300,000 units sold at $9 per unit • The per unit cost of material, labour and factory overhead are indicated above • Desired finished goods ending inventory is 30,000 units where beginning inventory was 20,000 units • Material used in in production in dollars is estimated at $620,000 • Desired material ending inventory is $60,000 where beginning inventory was $40,000 • Labour hours for production is estimated at 77,500 hours at $12 per hour • Factory overhead is estimated at $5 per labour hour worked • Beginning work in process inventory is $40,000 • Selling and administrative costs are $750,000 in the Budget Questions regarding the bottoms-up budget 1. Show the calculation of sales 2. Show the calculation of cost of goods sold (COGS) 3. How much material is purchased in the budget 4. What are total labour costs in the budget 5. What are total factory overhead costs in the budget 6. Show the development of work in process inventory in the budget 7. Show the development of the cost of finished goods inventory in the budget 8. What is a major driver of cash and, thus, should be an important execution goal coming out of the budget I
Expert Answer:
Answer rating: 100% (QA)
1Calculation of sales 300000 unitsS 9unit 2700000 2Calculation of Cost ... View the full answer
Related Book For
Principles Of Managerial Finance
ISBN: 978-0136119463
13th Edition
Authors: Lawrence J. Gitman, Chad J. Zutter
Posted Date:
Students also viewed these accounting questions
-
Answer the questions below using the cost curve for the price-taking firm shown in the following graph: 1. If price is $7 per unit of output, draw the marginal revenue curve. The manager should...
-
Answer the questions below in your own words. A verbatim answer coming from the notes/slides will not be given points. Answers must be in a paragraph form and must be composed of at least 5 to 8...
-
Answer the questions below by True OR Foals: 1) national sovereignty is a critical issue in assessing the environment (business climate) in which a firm operates 2) Buy American "is an example of...
-
A puck on a horizontal, frictionless surface is attached to a string that passes through a hole in the surface, as shown in FIGURE 11-52. As the puck rotates about the hole, the string is pulled...
-
On January 1, 2017, Klosterman Company issued $500,000, 10%, 10-year bonds at face value. Interest is payable annually on January 1. Instructions Prepare journal entries to record the following. (a)...
-
Sprague Company has been operating for several years, and on December 31, 2025, presented the following balance sheet. The net income for 2025 was $25,000. Assume that total assets are the same in...
-
Cloth Cutter The lengths of cloth a machine cuts for making dresses are normally distributed, with a mean of 3 meters and a standard deviation of 0.25 meters. (a) What is the probability that a...
-
On October 1, 2020, Mertag Company (a U.S.-based company) receives an order from a customer in Poland to deliver goods on January 31, 2021, for a price of 1,000,000 Polish zlotys (PLN). Mertag enters...
-
Assuming F_hull is 500kN. Can you solve the FBDs for the reaction forces at A, B and C? Bx B By 250 mm 40 400 mm Any Ax 178 mm Ax + 64 A W FR Fhull Fhull
-
Utilizing the financial information below for The Cookie Company, complete a budget performance report combining activity and revenue and spending variances like that in Exhibit Please be sure to...
-
A rectangular glass plane (height 10 cm, breadth 8 cm, and thickness = 0.2 cm) rests with the largest face flat on the surface of the water. Calculate the additional force required to pull the plane...
-
You work for a manufacturing company that has operations in the United States and Western Europe. However, increasing competition has prompted the firm to examine the option of shifting production to...
-
Provide a brief discussion on the validity of the following statements: - The fact Malthus' theory has not materialized yet does not mean it is proven wrong or discredited. - Technological fixes...
-
The establishment of the Free Trade Area of the Americas could be a threat as well as an opportunity for your company. Identify the countries participating in the negotiations for the FTAA. Are there...
-
What are the advantages and disadvantages of writing a BAM object class in an object - oriented language like C ++ ?
-
How would you test the validity and integrity of factory parameters stored in EEPROM? Sketch a suitable procedure for that purpose.
-
GES/17 1. When analyzing cash flow from shareholders, you notice a negative number. What does this mean? a. You can only have positive numbers for this ratio, so it indicates a calculation error b....
-
Juanita owns a home in Richardson, TX. She purchases a Homeowners Policy (HO-3) from Farm State Ins. Co. The policy provides $100,000 in liability coverage (coverage E) and $5,000 in Med Pay coverage...
-
What does it mean to say that individuals as a group are net suppliers of funds for financial institutions? What do you think the consequences might be in financial markets if individuals consumed...
-
Pelican Paper, Inc., and Timberland Forest, Inc., are rivals in the manufacture of craft papers. Some financial statement values for each company follow. Use them in a ratio analysis that compares...
-
Bond rating agencies have invested significant sums of money in an effort to determine which quantitative and nonquantitative factors best predict bond defaults. Furthermore, some of the raters...
-
Let \(A\) and \(B\) be disjoint events with \(P(A)=0.3\) and \(P(B)=0.45\). Determine the probabilities \(P(A \cup B), P(\overline{A \cup B}), P(\bar{A} \cup \bar{B})\), and \(P(\bar{A} \cap B)\).
-
Let \(P(A \cap \bar{B})=0.3\) and \(P(\bar{B})=0.6\). Determine \(P(A \cup B)\).
-
Check whether for 3 arbitrary random events \(A, B\), and \(C\) the following constellations of probabilities can be true: (1) \(P(A)=0.6, P(A \cap B)=0.2\), and \(P(A \cap \bar{B})=0.5\), (2)...
Study smarter with the SolutionInn App