Bart and Lisa operate a manufacturing operation in southern New Brunswick. They make a single product....
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Bart and Lisa operate a manufacturing operation in southern New Brunswick. They make a single product. In order to help ensure a successful year they have engaged you to prepare a complete master budget for the upcoming quarter. Lisa is a qualified engineer but not overly sophisticated in financial matters. Bart handles the design and marketing of their company's products." You have gathered the following information as of March 31, 2020: B&L Manufacturinge Balance Sheet March 31, 2020 60,000 624,000 302,587e 1,180,000 2,166,587 Cash 2$ Accounts Receivable Inventory Net Capital Assets Total Assets Accounts Payable 72.000- 200,000- Shareholder's Equity (SE) 1,894,587 2,166,587 Common Stock Total Liabilities and SE Inventory is made up of the following balances: $ 28.800 Raw Materials 6,400 unitse wmas C100 0 00/ WID $100,000- $173,787 WIP Finished Goods 4,800 unitse Recent and Projected Sales Unitse 6,000 February March $360,000 480.000 480.000 480.000 360.000 420,000 8,000 April Мay 8,000- 8,000 6,000 - 7,000- 10,000 10,000 June July August September 600.000 600.000 Credit accounts are collected 60% in the month following the sale and 40% in the next month following. There are no bad debts. Collections are current; the March A/R balance is made up of uncollected amounts from February and March sales. You may assume no changes to the WIP balances. Each unit produced requires $9.00 of raw materials (representing 2 units of material with a purchase cost of $4.50 per unit) and $20.00 of direct labour (2 hours of direct labour are required for each unit). There is a minimum of 5,000 labour hours per month regardless of how much time is worked. All labour is paid at $10 per hour (i.e. no overtime is paid.) Overhead is applied on the basis of direct labour hours. Variable overhead is estimated to be $1.50 per direct labour hour. The desired finished goods inventory is 60% of the next month's sales. The desired raw materials inventory is 40% of the next month's production requirements. All purchases are paid in the month following the purchase and all A/P is current. Fixed manufacturing overhead is estimated at $30,000 per month including total depreciation per month for manufacturing assets of $5,000.e Salaries, wages and commissions average 10% of sales, all other administrative expenses excluding depreciation is 5% of sales. Fixed selling and administrative expenses for rent, property taxes, depreciation and other items are $50,000 per month. Depreciation is $3,000 per month. There is a planned acquisition of a new machine in April for $150,000 which will be paid for in April. A dividend of $100,000 will be paid in June. Any borrowing the company makes are effective at the beginning of the month and all repayments are made at the end of the month. Ignore interest for the purposes of this assignment. The company does not want to begin a month with less than $30,000 in beginning cash. Income taxes can be ignored. Required: Prepare monthly budgeted income statements and cash flow projections for the quarter (April, May & June) along with all the supporting budgets and a Balance Sheet as of June 30, 2020). Each budget component should be prepared on a separate sheet. This must be prepared using Excel (DO NOT USE ANOTHER SPREADSHEET PROGRAM) and submitted electronically via email. PLEASE INCLUDE THE NAMES OF ALL GROUP MEMBERS ON THE FIRST SHEET OF YOUR EXCEL FILE. AS PER COURSE OUTLINE, THIS ASSIGNMENT MUST BE DONE IN TEAMS OF 2-3. Bart and Lisa operate a manufacturing operation in southern New Brunswick. They make a single product. In order to help ensure a successful year they have engaged you to prepare a complete master budget for the upcoming quarter. Lisa is a qualified engineer but not overly sophisticated in financial matters. Bart handles the design and marketing of their company's products." You have gathered the following information as of March 31, 2020: B&L Manufacturinge Balance Sheet March 31, 2020 60,000 624,000 302,587e 1,180,000 2,166,587 Cash 2$ Accounts Receivable Inventory Net Capital Assets Total Assets Accounts Payable 72.000- 200,000- Shareholder's Equity (SE) 1,894,587 2,166,587 Common Stock Total Liabilities and SE Inventory is made up of the following balances: $ 28.800 Raw Materials 6,400 unitse wmas C100 0 00/ WID $100,000- $173,787 WIP Finished Goods 4,800 unitse Recent and Projected Sales Unitse 6,000 February March $360,000 480.000 480.000 480.000 360.000 420,000 8,000 April Мay 8,000- 8,000 6,000 - 7,000- 10,000 10,000 June July August September 600.000 600.000 Credit accounts are collected 60% in the month following the sale and 40% in the next month following. There are no bad debts. Collections are current; the March A/R balance is made up of uncollected amounts from February and March sales. You may assume no changes to the WIP balances. Each unit produced requires $9.00 of raw materials (representing 2 units of material with a purchase cost of $4.50 per unit) and $20.00 of direct labour (2 hours of direct labour are required for each unit). There is a minimum of 5,000 labour hours per month regardless of how much time is worked. All labour is paid at $10 per hour (i.e. no overtime is paid.) Overhead is applied on the basis of direct labour hours. Variable overhead is estimated to be $1.50 per direct labour hour. The desired finished goods inventory is 60% of the next month's sales. The desired raw materials inventory is 40% of the next month's production requirements. All purchases are paid in the month following the purchase and all A/P is current. Fixed manufacturing overhead is estimated at $30,000 per month including total depreciation per month for manufacturing assets of $5,000.e Salaries, wages and commissions average 10% of sales, all other administrative expenses excluding depreciation is 5% of sales. Fixed selling and administrative expenses for rent, property taxes, depreciation and other items are $50,000 per month. Depreciation is $3,000 per month. There is a planned acquisition of a new machine in April for $150,000 which will be paid for in April. A dividend of $100,000 will be paid in June. Any borrowing the company makes are effective at the beginning of the month and all repayments are made at the end of the month. Ignore interest for the purposes of this assignment. The company does not want to begin a month with less than $30,000 in beginning cash. Income taxes can be ignored. Required: Prepare monthly budgeted income statements and cash flow projections for the quarter (April, May & June) along with all the supporting budgets and a Balance Sheet as of June 30, 2020). Each budget component should be prepared on a separate sheet. This must be prepared using Excel (DO NOT USE ANOTHER SPREADSHEET PROGRAM) and submitted electronically via email. PLEASE INCLUDE THE NAMES OF ALL GROUP MEMBERS ON THE FIRST SHEET OF YOUR EXCEL FILE. AS PER COURSE OUTLINE, THIS ASSIGNMENT MUST BE DONE IN TEAMS OF 2-3.
Expert Answer:
Related Book For
Fundamentals of Cost Accounting
ISBN: 978-0078025525
4th edition
Authors: William Lanen, Shannon Anderson, Michael Maher
Posted Date:
Students also viewed these finance questions
-
Damon Manufacturing is preparing its master budget for the first quarter of the upcoming year. The following data pertain to Damon Manufacturing's operations: Current Assets as of December 31 (prior...
-
Presidio Manufacturing is preparing its master budget for the first quarter of the upcoming year. The following data pertain to Presidio Manufacturing's operations: Current assets as of December 31...
-
Cicek Manufacturing is preparing its master budget for the first quarter of the upcoming year. The following data pertain to Cicek Manufacturings operations: Current Assets as of December 31 (prior...
-
You want to launch a business internationally, and you need to choose 3 countries1 in the Middle East, 1 in Asia, and 1 in Latin America. What are some of the components of these cultures that you...
-
When evaluating a companys performance on the time dimension, managers should only consider financial measures. Do you agree? Explain.
-
What are the three most common profit margins financial statement users assess using common-size analysis of an income statement? What do these profit margins indicate?
-
On December 31, Casper, Inc., issued \(\$ 300,000\) of eight percent, ten-year bonds for \(\$ 262,613\), yielding an effective interest rate of ten percent. Semiannual interest is payable on June 30...
-
Book vs. Tax (MACRS Depreciation) Annunzio Enterprises purchased a delivery truck on January 1, 2010, at a cost of $41,000. The truck has a useful life of 7 years with an estimated salvage value of...
-
Swift Corporation is leasing a machine from Gray, Inc. Swift's incremental borrowing rate is 13%. The prime rate of interest is currently 7%. Gray's implicit rate in the lease is 9%; Swift knows this...
-
There are two wooden sticks of lengths A and B respectively. Each of them can be cut into shorter sticks of integer lengths. Our goal is to construct the largest possible square. In order to do this,...
-
Cabio Company manufactures two products, Product C and Product D. The company estimated it would incur $198,910 in manufacturing overhead costs during the current period. Overhead currently is...
-
Fickel Company has two manufacturing departments-Assembly and Testing & Packaging. The predetermined overhead rates in Assembly and Testing & Packaging are $22.00 per direct labor-hour and $18.00 per...
-
"""A BARD DAY'S NIGHTa.k.a. BARD ROCK CAFEa.k.a. THE SCHOOL OF BARD KNOCKSa.k.a. A BARD RAIN'S A-GONNA FALL""" # Imports from typing import Optional, TextIO, Dict, Set, List,Tuple # Specific...
-
. . . . . . . . . . . . . . . . is the mental ability to analyze and diagnose complex situations. A . Decision Skills B . People Skills C . Conceptual Skills D . Technical Skills
-
A 30-year fully amortizing mortgage loan was made 10 years ago for $75,000 at 10 percent interest. The borrower would like to prepay the mortgage balance by $10,000. Assuming he can reduce his...
-
provide a 5 line text of the importance of doing a swot analysis when doing a finance analysis for a company
-
Required information [The following information applies to the questions displayed below.] Nautical has two classes of stock authorized: $10 par preferred, and $1 par value common. As of the...
-
What is the maximum volume of 0.25 M sodium hypochlorite solution (NaOCl, laundry bleach) that can be prepared by dilution of 1.00 L of 0.80 M NaOCl?
-
Noonan Division has total assets (net of accumulated depreciation) of $3,300,000 at the beginning of year 1. One of the assets is a machine that has a net book value of $300,000. Expected divisional...
-
The Bubble Company produces a variety of bottles from recycled plastic. The company has one particular machine on which it can produce either of two types of water bottles, 1-liter bottles or...
-
Consider the Business Application item, "Cost Analysis and the Choice of Office Space for a Small Business". In the decision to relocate to the virtual office, what are the differential costs? What...
-
Claire Corporations trial balance includes the following expenses: Assuming no change in the work-in-process and finished goods inventory balances for the year, what total amount should Claire report...
-
Carson Company reported the following amounts for December: What amount of raw materials was used in production in December? a. $71,000 b. $73,000 c. $77,000 d. $85,000 Beginning raw materials...
-
Carson Company reported the following amounts for December: What is cost of goods manufactured for December? a. $176,000 b. $182,000 c. $186,000 d. $188,000 Beginning raw materials inventory....
Study smarter with the SolutionInn App