Prepare a master budget for McGregor Pharmacy Company for the year ending December 31, 2021 using the following information. Prepare it per quarter. Use the tables provided by the professor. Fill it.

 

 

Prepare the Sales Budget assuming:

 

1. Expected sales volume: 8,000 units for the first quarter, an increase of 20% is expected for the second quarter, a decrease of 10% for the third quarter, and an increase of 25% for the fourth quarter.

2. The sales price should be $75.00 for the first two quarters and $82.50 for the last two quarters.

 

Prepare the Production Budget assuming:

 

1. The company believes it can meet future sales needs with an ending inventory of 25% of the next quarter, for the first two quarters, and 35% of the next quarter, for the last two quarters.

2. The expected sales in units for the first quarter of 2022 is 11,000.

 

Prepare the Direct Material Budget assuming: 

 

1. Ending inventory of raw material is expected to be 15% of total pounds needed for production of the next quarter for the first two quarters and 20% of the next quarter for the last two quarters.

2. The expected pounds needed for production in the first quarter of 2022 is 38,500.

3. Each product requires 3 pounds of raw material.

4. The expected cost per pound is $8.25.

 

 

 

 

Prepare the Direct Labor Budget assuming: 

 

1. To produce a unit is required 2.5 hours of direct labor.

2. The hourly wage rate is expected to be $7.50.

 

Prepare the Manufacturing Overhead Budget assuming: 

 

1. The supervisor salaries are $42,000 per quarter.

2. The indirect material is expected to be $1.15 per direct labor hour.

3. Depreciation is expected to be $6,500 per quarter.

4. Other variable cost is expected to be $1.75 per direct labor hour.

5. Property taxes and insurance are expected to be $11,500 per quarter.

6. Indirect labor is expected to be $1.60 per direct labor hour.

7. Maintenance is expected to be $.25 per direct labor hour plus $3,500 per quarter.

 

Prepare the Selling and Administrative Budget assuming: 

 

1. Advertising expenses are expected to be of $2,500 per quarter.

2. Freight-out is expected to be $1.10 per unit sold.

3. Sale Commission is expected to be $2.45 per unit sold.

4. Office salaries are expected to be $3,200 per quarter.

5. Depreciation is expected to be $1,750 per quarter.

6. Other variable costs are expected to be $.25 per unit sold.

7. Sales salaries are expected to be $18,000 per quarter.

8. Property taxes and insurance are expected to be $750 per quarter.

9. Miscellaneous expense is expected to be $.15 per direct labor hour plus $350

per quarter.

 

 

Prepare the Budgeted Income Statement with the information above and the following information:

 

1. Manufacturing overhead required per unit is 2.5

2. Interest Expense is $12,000.

3. Income tax rate is 15.5%

 

 

Answer rating: 100% (QA)

ANSWER ATTACHED IMAGE SALES BUDGET PARTICULARS EXPECTED SALES VOLUME UNITS EXPECTED SELLING PR... View the full answer