_ G Direct labor cost per unit 0.43 Variable manufacturing overhead costs per unit 110 Fixed manufacturing overhead costs per unit _ 07 Budgeted cost of manufacturing one unit Requirement 10. Prepare a budgeted income staternent for the quarter ending March 31. (Hint: Cost of goods sold = Budgeted cost of manufacturing one unit x Number of units sold.) (Round your answers to the nearest whole dollar) Dalley Manufacturing Budgeted Income Statement For the Quarter Ended March 31 Sales revenue $ 333,600 Less: Cost of goods sold e Gross profit 104,250 Less: Operating expenses (40,150) Less: Depreciation expense (4,600) Operating income E Less: Interest expense (490) Less: Income tax expense (10518) Net income 24542 a.Actual sales in December were $71,000. Selling price per unit is projected to remain stable at $12 per unit throughout the budget period. Sales for the first five months of the upcoming year are budgeted to be as follows: January ........ $ 99,600 February ....... $ 118,800 March.......... $ 115,200 April ..o $ 108,000 May............ $ 103,200 b.Sales are 35% cash and 65% credit. All credit sales are collected in the month following the sale. c.Dalley Manufacturing has a policy that states that each month's ending inventory of finished goods should be 10% of the following month's sales (in units). d.Of each month's direct material purchases, 20% are paid for in the month of purchase, while the remainder is paid for in the month following purchase. Three pounds of direct material is needed per unit at $2.00 per pound. Ending inventory of direct materials should be 20% of next month's production needs. e.Most of the labor at the manufacturing facility is indirect, but there is some direct labor incurred. The direct labor hours per unit is 0.05. The direct labor rate per hour is $9 per hour. All direct labor is paid for in the month in which the work is performed. The direct labor total cost for each of the upcoming three months is as follows: January ........ 3807 February ....... $ 4442 March.......... 4293 f. Monthly manufacturing overhead costs are $5,500 for factory rent, $2,900 for other fixed manufacturing expenses, and $1.10 per unit for variable manufacturing overhead. No depreciation is included in these figures. All expenses are paid in the month in which they are incurred. g.Computer equipment for the administrative offices will be purchased in the upcoming guarter. In January, Dalley Manufacturing will purchase equipment for $5,000 (cash), while February's cash expenditure will be $12,200 and March's cash expenditure will be $16.600. h.Operating expenses are budgeted to be $1.25 per unit sold plus fixed operating expenses of $1,800 per month. All operating expenses are paid in the month in which they are incurred. No depreciation is included in these figures. . Depreciation on the building and equipment for the general and administrative offices is budgeted to be 54,600 for the entire guarter, which includes depreciation on new acquisitions. . Dalley Manufacturing has a policy that the ending cash balance in each month must be at least $4,000. It has a line of credit with a local bank. The company can borrow in increments of $1,000 at the beginning of each month, up to a total outstanding loan balance of $100,000. The interest rate on these loans is 1% per month simple interest (not compounded). The company would pay down on the line of credit balance in increments of $1,000 if it has excess funds at the end of the quarter. The company would also pay the accumulated interest at the end of the guarter on the funds borrowed during the quarter. k.The company's income tax rate is projected to be 30% of operating income less interest expense. The company pays $10,000 cash at the end of February in estimated taxes. Ll X Data table Current Assets as of December 31 (prior year): Cash 4,600 Accounts receivable, net 48,000 Inventory $ 15,100 Property, plant, and equipment, net . .. .. 120,000 Accounts payable . . . .. $ 43,000 Capital stock . . ... $ 124,500 Retained earnings. $ 22,600 Print DoneRequirements ol 0N m M Prepare a schedule of cash collections for January, February, and March, and for the guarter in total. Prepare a production budget. {(Hint: Unit sales = Sales in dollars / Selling price per unit.) Prepare a direct materials budget. Prepare a cash payments budget for the direct material purchases from Requirement 3. (Use the accounts payable balance at December 31 of prior year for the prior month payment in January.) Prepare a cash payments budget for direct labor. Prepare a cash payments budget for manufacturing overhead costs. Prepare a cash payments budget for operating expenses. Prepare a combined cash budget. Calculate the budgeted manufacturing cost per unit (assume that fixed manufacturing overhead is budgeted to be $0.70 per unit for the year). Prepare a budgeted income statement for the guarter ending March 31. (Hint: Cost of goods sold = Budgeted cost of manufacturing one unit x Number of units sold.) Requirement 1. Prepare a schedule of cash collections for January, February, and March, and for the quarter in total. Dalley Manufacturing Cash Collections Budget For the Quarter Ended March 31 Month January February March Quarter Cash sales 34.860 $ 41,580 40,320 $ 116,760 188,110 Credits sales 46.150 64,740 77,220 S 81,010 $ 106,320 $ 117,540 $ 304,870 Total cash collectionsRequirement 2. Prepare a production budget. (Hint: Unit sales = Sales in dollars + Selling price per unit.) Dalley Manufacturing Production Budget For the Quarter Ended March 31 Month January February March Quarter Unit sales 8,300 9,900 9,600 27,800 Plus: Desired ending inventory 990 960 900 900 Total needed 9,290 10,860 10,500 28,700 Less: Beginning inventory 830 _ 990 960 = 830 Units to produce 8460 9,870 9,540 27,870 Requirement 3. Prepare a direct materials budget. (Round your answers to the nearest whole dollar.) Dalley Manufacturing Direct Materials Budget For the Quarter Ended March 31 Month January February March Units to be produced 8,460 9,870 9,540 Multiply by: Quantity {pounds) of DM needed per unit s 3 _ 00003 Quantity (pounds) needed for production 25,380 29,610 28,620 Plus: Desired ending inventory of DM 9922 9724 9376 Total quantity (pounds) needed 31,302 35,334 33,996 Less: Beginning inventory of DM _ 50me 99822 = 5724 CGuantity (pounds) to purchase 26,226 29,412 28,272 5 200 % 200 % 2.00 Multiply by: Cost per pound Total cost of DM purchases 3 52452 58824 56544 5 5 Quarter 27,870 3 83,610 5,376 88,986 5,076 83,910 2.00 167,820 Requirement 4. Prepare & cash payments budget for the direct material purchases from Requirement 3. (Use the accounts payable balance at December 21 of prier year for the prior month payment in January.) (Round your answers to the nearest whole dollar) Dalley Manufacturing Cash Payments for Direct Materials Budget For the Quarter Ended March 31 Month January February March Quarter 20% of current meonth DM purchases 3 10490 $ 11,765 $ 11,309 $ 33,564 43,000 41,962 47,059 132.021 80% of last month's DM purchases Total cash payments $ 53490 $ 53727 $ 58,368 $ 165585 Requirement 5. Prepare a cash payments budget for direct labor. Dalley Manufacturing Cash Payments for Direct Labor Budget For the Quarter Ended March 31 Month January February March Quarter 3 3.807 $ 4442 4293 12,542 Total cost of direct labor Requirement 6. Prepare a cash payments budget for manufacturing overhead costs. (Round your answers to the nearest whole dollar.) Dalley Manufacturing Cash Payments for Manufacturing Overhead Budget For the Quarter Ended March 31 Month January February March Quarter Variable manufacturing overhead costs 9,306 $ 10,857 $ 10,494 $ 30,657 Rent (fixed) 5,500 5,500 5,500 16,500 Other fixed MOH 2,900 2,900 2,900 8,700 Cash payments for manufacturing overhead 17,706 $ 19,257 18,894 55,857Requirement 7. Prepare a cash payments budget for operating expenses. (Round your answers to the nearest whole dollar.) Dalley Manufacturing Cash Payments for Operating Expenses Budget For the Quarter Ended March 31 Month January February March Quarter ariable operating expenses $ 10375 $ 12375 % 12000 % 34,750 1,800 1,800 1,800 2,400 Fixed operating expenses Cash payments for operating expenses $ N 5 I $ L $ =k 1l Requirement 8. Prepare a combined cash budget. (If an input field is not used in the table leave the input field empty; do not enter a zero. Use parentheses or a minus sign for negative cash balances and financing payments.) Dalley Manufacturing Combined Cash Budget For the Quarter Ended March 31 January February March Quarter Beginning cash balance $ 4600 $ 4432 4951 4,600 Plus: Cash collections 81,010 106,320 117,540 304,870 Total cash available 85,610 110,752 122,491 309,470 Less: cash payments: Direct material purchases 53,490 53,727 58,368 165,585 Direct labor 3,807 4,442 4293 12,542 Manufacturing overhead costs 17,706 19,257 18,894 55,857 Operating expenses 12,175 14,175 13.800 40,150 Tax payment 10,000 10,000 Equipment purchases 5,000 12,200 16,600 33,800 Total ash payments 92,178 113,801 111,955 317,934 Ending cash balance before financing (6.568) (3.049) 10.536 (8.464) Financing: Plus: New borrowings 11,000 6,000 19,000 Less: Debt repayments (6,000) (6,000) Plus: New borrowings 11,000 8,000 19,000 Less: Debt repayments (6,000) (6,000) Less: Interest payments (490) (490) Total financing 11,000 8,000 (6.490) 12,510 3 4432 4951 4046 4,046 Ending cash balance Requirement 9. Calculate the budgeted manufacturing cost per unit (assume that fixed manufacturing overhead is budgeted to be $0.70 per unit for the vear). (Round your answer to the nearest cent.) Dalley Manufacturing Budgeted Manufacturing Cost per Unit For the Quarter Ended March 31 Direct materials cost per unit 6.00 Direct labor cost per unit 0.45 Variable manufacturing overhead costs per unit 1.10 0.70 Fixed manufacturing overhead costs per unit Budgeted cost of manufacturing one unit 3 825 Requirement 10. Prepare a budgeted income statement for the quarter ending March 31. (Hint: Cost of goods sold = Budgeted cost of manufacturing one unit x Number of units sold.) (Round your answers 1o the nearest whole dollar.) Dalley Manufacturing Budgeted Income Statement For the Quarter Ended March 31 Sales revenue 5 333600 Less: Cost of goods sold _(229,350) Gross profit 104,250 Less: Operating expenses (40,150) Less: Depreciation expense (4,600) Operating income 35550 Less: Interest expense (490) Less: Income tax expense __(10518) Met income T