1. Budgeted Sales by month for the Cheap Book Company are as follows:

January $450,000

February $600,000

March $700,000

April $200,000

May $180,000

June $300,000

July $400,000

August $500,000

September $800,000

October $900,000

November $850,000

December $550,000

A review of cash collection history indicates that cash collected in the month of sale amounts to 25 percent of sales, cash collected one month after the sale amounts to 40 percent of sales, cash collected two months after the sale amounts to 30 percent of sales and cash collected three months after the sale amount to 5 percent of sales.

Assuming that the cash receipts budget is based on the above information, please calculate the cash that will be collected in each of the following months:

July:

August:

September:

2. The Good Production Company makes darn good products that cost a lot of money. Based on their production and sales history, their policy is to end the month with 25 percent of their units that they expect to sell in the following month.

Budgeted unit sales for selected months are as follows:

July 600 units

August 820 units

September 900 units

October 1,000 units

Assuming that the company started the month of July with 150 units in beginning inventory, how many units must be produced in each of the following months:

July:

August:

September:

3. The Dress for Success Pants Company manufactures off the rack dress pants from a special fabric. The standard material cost for making one pair of pants is as follows:

5 yards of fabric at $5 per yard$25.00

During the prior month the Company made 3,500 dress pants using 18,200 yards of fabric at a total fabric cost of $86,450.

Instructions:

Please compute each of the following:

1. The material price variance

2. The material quantity variance

3. The total material variance

4. The Dress for Success Pants Company manufactures off the rack dress pants from a special fabric. The standard labor cost for making one pair of pants is as follows:

3 hours of labor at $15 per labor hour..$45.00

During the prior month the Company made 3,500 dress pants using 11,000 hours of labor at a total labor cost of $154,000.

Instructions:

Please compute the following:

1. The labor rate variance

2. The labor efficiency variance

3. The total labor variance