Example (1): Mostafa Company is preparing budgets for the quarter ending March 31, 2021. Budgeted sales...

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Example (1): Mostafa Company is preparing budgets for the quarter ending March 31, 2021. Budgeted sales for the next 4 months are as follows: 1 100 units 2 300 units 3 200 units Additional Information: 1- The selling price is $10 per unit. 2- Mostafa's collection pattern is to collect 100% of sales during the same month of sales. 3- The management wants ending inventory of product to be equal to 10% of the following month's budgeted sales in units. 4- Each unit of product required 2 Kg. of Material. The management wants ending inventory of material to be equal to 10% of the current month's budgeted production needs. The production needs during December 2020 were 140 Kg. The purchase price is $0.5 per Kg. 5- Mostafa's payment pattern is to pay 100% of purchases during the same month of purchase. 6- Cash payment for Direct Labor, Manufacturing Overhead, and Selling & Administrative costs during this quarter estimated as follows: Cash payments for DL Cash payments for MOH Cash payments for S&A Q 1,743 456 2,599 150 120 370 200 100 475 7- The company Will purchase a new equipment during January of $600 in cash. Also, it will declare dividends of $1,200 during February, & it is expected to pay all dividends during the same month. 8- The company has a January, 1 cash balance of $500. 9- The company maintains a minimum cash balance of $400. Required: prepare the following budgets: 1- Sales Budget. 2- Production Budget. 3- Material Budget. 4- Cash Budget. 4 500 units 400 100 175 (1): Sales Budget & in dollars as follows: Example (1): Mostafa Company is preparing budgets for the quarter ending March 31, 2021. Budgeted sales for the next 4 months are as follows: 1 100 units 2 300 units 3 200 units Additional Information: 1- The selling price is $10 per unit. 2- Mostafa's collection pattern is to collect 100% of sales during the same month of sales. 3- The management wants ending inventory of product to be equal to 10% of the following month's budgeted sales in units. 4- Each unit of product required 2 Kg. of Material. The management wants ending inventory of material to be equal to 10% of the current month's budgeted production needs. The production needs during December 2020 were 140 Kg. The purchase price is $0.5 per Kg. 5- Mostafa's payment pattern is to pay 100% of purchases during the same month of purchase. 6- Cash payment for Direct Labor, Manufacturing Overhead, and Selling & Administrative costs during this quarter estimated as follows: Cash payments for DL Cash payments for MOH Cash payments for S&A Q 1,743 456 2,599 150 120 370 200 100 475 7- The company Will purchase a new equipment during January of $600 in cash. Also, it will declare dividends of $1,200 during February, & it is expected to pay all dividends during the same month. 8- The company has a January, 1 cash balance of $500. 9- The company maintains a minimum cash balance of $400. Required: prepare the following budgets: 1- Sales Budget. 2- Production Budget. 3- Material Budget. 4- Cash Budget. 4 500 units 400 100 175 (1): Sales Budget & in dollars as follows:

Answer rating: 100% (QA)

Here are the budgets for Mostafa Company for the quarter ending March 31 2021 1 Sales Budget Month U... View the full answer