Developing a Master Budget for a Manufacturing Organization Challenge Problem Computer Accessories Inc assembles a computer networking device from kits of imported components You have been asked to develop a quarterly and annual operating budget and pro forma income statements for next year You have obtained the following information Beginningofyear balances Cash 75000 Accounts receivable previous quarters sales 245000 Raw materials 950 kits Finished goods 1500 kits Accounts payable materials 125000 Borrowed funds 30000 Desired endofyear inventory balances Raw materials 1000 kits Finished goods 1600 kits Desired endofquarter balances Cash 30000 Raw materials as a portion of the following quarters production 020 Finished goods as a portion of the following quarters sales 030 Manufacturing costs Standard cost per unit Units Unit price Total Direct labor hours at rate 050 hour 3000 1500 Raw materials 1 kit 7500 7500 Variable overheadlabor hour 050 hour 500 250 Total standard variable cost 9250 Fixed cost per quarter Cash 110000 Depreciation 15000 Total 125000 Selling and administrative costs 800 Variable cost per unit Fixed costs per quarter Cash 150000 Depreciation 7500 Total 157500 Interest rate per quarter 0015 Portion of sales collected Quarter of sale 070 Subsequent quarter 029 Bad debts 001 Portion of purchases paid Quarter of purchase 060 Subsequent quarter 040 Unit selling price 225 Sales forecast Quarter First Second Third Fourth Unit sales 4400 4600 4500 4800 Additional information All cash payments except purchases are made quarterly as incurred All borrowings occur at the start of a quarter All repayments on borrowings occur at the end of a quarter At the time the principal is repaid interest is paid on the portion of principal that is repaid Borrowings and repayments may be made in any amount Required Note Do not use negative signs with any of your answers in the requirements that follow Part A Part B Part C Part D Part E Part F Part G g A pro forma contribution income statement for each quarter and the year Electric Monkey Computer Accessories Pro Forma Contribution Income Statement For the Year Ending December 31 First Second Third Fourth Total Sales revenue Answer 236 0 Answer 237 0 Answer 238 0 Answer 239 0 Answer 240 0 Less variable costs Cost of goods sold Answer 241 0 Answer 242 0 Answer 243 0 Answer 244 0 Answer 245 0 Selling and admin Answer 246 0 Answer 247 0 Answer 248 0 Answer 249 0 Answer 250 0 Total variable costs Answer 251 0 Answer 252 0 Answer 253 0 Answer 254 0 Answer 255 0 Contribution margin Answer 256 0 Answer 257 0 Answer 258 0 Answer 259 0 Answer 260 0 Less fixed costs Manufacturing overhead Answer 261 0 Answer 262 0 Answer 263 0 Answer 264 0 Answer 265 0 Selling and admin Answer 266 0 Answer 267 0 Answer 268 0 Answer 269 0 Answer 270 0 Total fixed costs Answer 271 0 Answer 272 0 Answer 273 0 Answer 274 0 Answer 275 0 Operating income Answer 276 0 Answer 277 0 Answer 278 0 Answer 279 0 Answer 280 0 Less interest expense Answer 281 0 Answer 282 0 Answer 283 0 Answer 284 0 Answer 285 0 Net income loss Answer 286 0 Answer 287 0 Answer 288 0 Answer 289 0 Answer 290 0