Garfield Case Project - 150 points Garfield and George Foreman are contemplating becoming business partners of an out-door grill company appropriately named, "Outdoor Chef Grill." Garfield has been a customer of George Foreman's grills for years. George accepted his proposal to be a business partner, as he believes that Garfield's name will bring in a new demographic of shoppers. Garfield needs to obtain funding for his capital contribution. Potential investors have asked for budgets and forecasts for the revenue and expenses of the company. George is having the finance department create a special monthly forecast budget for Roger as well as an annual forecast and budget. You, being one of George's employees, is asked to prepare the monthly budget for January 2021. Budget Requirements: 100 points Using the information below, please prepare 1. Sales Budget including a schedule of expected cash collection. 2 Production Budget 3. Direct Materials budget including a schedule of expected cash disbursements. 4. Direct Labor Budget 5. MOH Budget including cash disbursements for overhead 6. S&A budget including cash disbursements for S&A 7. Budgeted Income Statement. When calculating COGS please illustrate how you computed the COGs per unit. b. Must calculate a COST Per Unit for each product line. 8 Cash Budget a. FOR BUDGETS 1-8: IF ROUNDING IS NECESSARY, PLEASE ROUND TO TWO DECIMALS. Excel Requirements: 50 points The budgets are to be completed in Excel. Please use the Excel File uploaded on Canvas. The Excel Requirements are as follows: 1. Each Budget will appear in an individual worksheet with each Tab labeled with appropriate Budget's Name. All calculations must be completed in excel using formulas 2 !!!Remember!!!! The case is to be completed in teams of individually or in teams of 2. You will have 2 weeks to complete the project. You may ask Sheila, other instructors, or tutors for help or clarification but collaborating with other students outside of your group is not permitted. Any evidence of collaboration will result in a zero for the assignment and possible withdraw from the class. The project will be worth 13% of your final grade. 1 Selected information concerning sales and production for January 2021 is summarized as follows: a. The sales budget must be divided up by product (Backyard and Master) 288 units at $775 per unit 200 units at $1,550 per unit Estimated sales for January by sales territory: Georgia: Backyard Master South Carolina: Backyard Master Louisiana: Backyard Master Alabama Backyard Master 219 units at $880 per unit 168 units at $1,666 per unit 345 units at $855 per unit 215 units at $1,777 per unit 175 units @ $888 per unit 199 @ $1600 per unit Estimated sales for February for all territories: Backyard Grills 624 grills Master Grills 1,150 grills Outdoor Chef Grill has a beginning accounts receivable balance of $1,550,000 in the month of January and expects to collect 40% of that balance. In addition, their accounting department has estimated that 70% of sales for the Master Grill will be paid in cash and 80% of the Backyard grill will be paid in cash. b. Inventory of Grills Beginning Inventory of Grills: Backyard Master 36 units 18 units Outdoor Chef Grill has established a new ending inventory policy to take effect the month of January From January and going forward, the ending inventory should be: Ending Inventory: Backyard Master 2% of February's sales 5% of February's sales. 2 c. Estimated direct material inventories at January 1: Direct materials (available for the Master and Backyard Grill): Grates Stainless steel Burner subassemblies Shelves 300 units 1.800 lbs. 150 units 300 units Desired inventories at January 30: : Direct materials (available for the Master and Backyard Grill): Grates Stainless steel Burner subassemblies Shelves 230 units 1,200 lbs. . 325 units 285 units d. Direct materials used in production: Direct Materials required to produce one Backyard Chef Grill: Grates Stainless steel Burner subassemblies Shelves 3 units per unit of product 24 lbs. per unit of product 2 units per unit of product 4 units per unit of product Direct Materials required to produce one Master Chef grill: Grates Stainless steel Burner subassemblies Shelves 6 units per unit of product 42 lbs. per unit of product 4 units per unit of product 5 units per unit of product Anticipated purchase price for direct materials: Grates Stainless steel Burner subassemblies Shelves $14 per unit $7 per lb. $115 per unit $8 per unit 3 Because of their excellent relationships with the vendors, they pay the following percentages when placing their order: Grates: 10% Stainless Steel: 25% Burner subassemblies 5% Shelves 2%, if pay the entire balance within 35 days. e Direct labor requirements for one grill: 0.60 hr. at $17 per hr. 0.80 hr. at $14 per hr. 2.0 hrs. at $12 per hr. Backyard Chef: Stamping Department Forming Department Assembly Department Master Chef: Stamping Department Forming Department Assembly Department .80 hr. at $17 per hr. 1.50 hrs. at $14 per hr. 2.50 hrs. at $12 per hr. f Outdoor Chef Grill Company budgeted the following fixed costs for anticipated production in January. The list below includes fixed MOH expenses and Fixed S&A expenses. Please categorize the fixed cost as MOH or S&A (Period) prior to completing any calculations. Advertising Expenses $24,000 Sales monthly salary (not commission) $7,500 Factory Insurance $2,000 Production Supervisor Salary $9,900 Executive officer salaries $25,000 Indirect Labor Salaries for Quality Control $2,800 Factory Depreciation $4,000 Corporate Office Building Depreciation $3,100 Hint. The sum of the FMOH costs above will appear in MOH Budget. The sum of the Fixed S&A (Period) costs will appear in the S&A Budget. Hint. For non-cash expenses, please divided the fixed non-cash expenses between Master and Backyard. 8 Total estimated VMOH expenses are $41,000 for the month of January. VMOH expenses are allocated to the products based on a single PDOR rate using the allocation base, TOTAL DL HOURS. Requirement: Please calculate a PDOR for the company using Total DL hours. Hint, you will only have one PDOR for the company. There will NOT be two separate PDORs for the Backyard and Master product. Variable S&A expenses are allocated at rate of $3 per grill. h. a. Other Information: Income Tax Rate is 35% b. Minimum Cash Balance $500,000 Beginning Cash Balance $750,000 5 Garfield Case Project - 150 points Garfield and George Foreman are contemplating becoming business partners of an out-door grill company appropriately named, "Outdoor Chef Grill." Garfield has been a customer of George Foreman's grills for years. George accepted his proposal to be a business partner, as he believes that Garfield's name will bring in a new demographic of shoppers. Garfield needs to obtain funding for his capital contribution. Potential investors have asked for budgets and forecasts for the revenue and expenses of the company. George is having the finance department create a special monthly forecast budget for Roger as well as an annual forecast and budget. You, being one of George's employees, is asked to prepare the monthly budget for January 2021. Budget Requirements: 100 points Using the information below, please prepare 1. Sales Budget including a schedule of expected cash collection. 2 Production Budget 3. Direct Materials budget including a schedule of expected cash disbursements. 4. Direct Labor Budget 5. MOH Budget including cash disbursements for overhead 6. S&A budget including cash disbursements for S&A 7. Budgeted Income Statement. When calculating COGS please illustrate how you computed the COGs per unit. b. Must calculate a COST Per Unit for each product line. 8 Cash Budget a. FOR BUDGETS 1-8: IF ROUNDING IS NECESSARY, PLEASE ROUND TO TWO DECIMALS. Excel Requirements: 50 points The budgets are to be completed in Excel. Please use the Excel File uploaded on Canvas. The Excel Requirements are as follows: 1. Each Budget will appear in an individual worksheet with each Tab labeled with appropriate Budget's Name. All calculations must be completed in excel using formulas 2 !!!Remember!!!! The case is to be completed in teams of individually or in teams of 2. You will have 2 weeks to complete the project. You may ask Sheila, other instructors, or tutors for help or clarification but collaborating with other students outside of your group is not permitted. Any evidence of collaboration will result in a zero for the assignment and possible withdraw from the class. The project will be worth 13% of your final grade. 1 Selected information concerning sales and production for January 2021 is summarized as follows: a. The sales budget must be divided up by product (Backyard and Master) 288 units at $775 per unit 200 units at $1,550 per unit Estimated sales for January by sales territory: Georgia: Backyard Master South Carolina: Backyard Master Louisiana: Backyard Master Alabama Backyard Master 219 units at $880 per unit 168 units at $1,666 per unit 345 units at $855 per unit 215 units at $1,777 per unit 175 units @ $888 per unit 199 @ $1600 per unit Estimated sales for February for all territories: Backyard Grills 624 grills Master Grills 1,150 grills Outdoor Chef Grill has a beginning accounts receivable balance of $1,550,000 in the month of January and expects to collect 40% of that balance. In addition, their accounting department has estimated that 70% of sales for the Master Grill will be paid in cash and 80% of the Backyard grill will be paid in cash. b. Inventory of Grills Beginning Inventory of Grills: Backyard Master 36 units 18 units Outdoor Chef Grill has established a new ending inventory policy to take effect the month of January From January and going forward, the ending inventory should be: Ending Inventory: Backyard Master 2% of February's sales 5% of February's sales. 2 c. Estimated direct material inventories at January 1: Direct materials (available for the Master and Backyard Grill): Grates Stainless steel Burner subassemblies Shelves 300 units 1.800 lbs. 150 units 300 units Desired inventories at January 30: : Direct materials (available for the Master and Backyard Grill): Grates Stainless steel Burner subassemblies Shelves 230 units 1,200 lbs. . 325 units 285 units d. Direct materials used in production: Direct Materials required to produce one Backyard Chef Grill: Grates Stainless steel Burner subassemblies Shelves 3 units per unit of product 24 lbs. per unit of product 2 units per unit of product 4 units per unit of product Direct Materials required to produce one Master Chef grill: Grates Stainless steel Burner subassemblies Shelves 6 units per unit of product 42 lbs. per unit of product 4 units per unit of product 5 units per unit of product Anticipated purchase price for direct materials: Grates Stainless steel Burner subassemblies Shelves $14 per unit $7 per lb. $115 per unit $8 per unit 3 Because of their excellent relationships with the vendors, they pay the following percentages when placing their order: Grates: 10% Stainless Steel: 25% Burner subassemblies 5% Shelves 2%, if pay the entire balance within 35 days. e Direct labor requirements for one grill: 0.60 hr. at $17 per hr. 0.80 hr. at $14 per hr. 2.0 hrs. at $12 per hr. Backyard Chef: Stamping Department Forming Department Assembly Department Master Chef: Stamping Department Forming Department Assembly Department .80 hr. at $17 per hr. 1.50 hrs. at $14 per hr. 2.50 hrs. at $12 per hr. f Outdoor Chef Grill Company budgeted the following fixed costs for anticipated production in January. The list below includes fixed MOH expenses and Fixed S&A expenses. Please categorize the fixed cost as MOH or S&A (Period) prior to completing any calculations. Advertising Expenses $24,000 Sales monthly salary (not commission) $7,500 Factory Insurance $2,000 Production Supervisor Salary $9,900 Executive officer salaries $25,000 Indirect Labor Salaries for Quality Control $2,800 Factory Depreciation $4,000 Corporate Office Building Depreciation $3,100 Hint. The sum of the FMOH costs above will appear in MOH Budget. The sum of the Fixed S&A (Period) costs will appear in the S&A Budget. Hint. For non-cash expenses, please divided the fixed non-cash expenses between Master and Backyard. 8 Total estimated VMOH expenses are $41,000 for the month of January. VMOH expenses are allocated to the products based on a single PDOR rate using the allocation base, TOTAL DL HOURS. Requirement: Please calculate a PDOR for the company using Total DL hours. Hint, you will only have one PDOR for the company. There will NOT be two separate PDORs for the Backyard and Master product. Variable S&A expenses are allocated at rate of $3 per grill. h. a. Other Information: Income Tax Rate is 35% b. Minimum Cash Balance $500,000 Beginning Cash Balance $750,000 5