The Gay Tre Company matures racines for the rays for 170 ch Gray ang data for Gray Tre Company el you by a master bodet tyre lys balance sheet to December 31, 2016. m on to www.ch) Click the conto whe Real Requirement 1.Grayson and the 2018 by equired chees and get des product butter budget de border ved blot cost of goods sold to wing and we had the cash payments and caring and costs are located based on rector hours. Round at Groot hearest Bog by wing the sales but Grady Ture Company det For Year Ended December 31, 2018 Fit Second Third Fourth Quarter Quarter Quarter Total se sont 1.000 1000 1.100 T.150 00 Sale per un 3 705 TO 1 203 TOS 77.000 10530 1.600 2001 Prepare the production Budget Grad Tre Como Choose front or traumber in the input and then click Check Ans Other data for Grady Tire Company: (Click the icon to view the other data.) Read the reguicements The Grady Tire Company manufactures racing tires for bicycles. Grady sells tires for $70 each. Grady is planning for the next year by developing a master budget by quarters, Grady's balance sheet for December 31, 2018, follows: Click the icon to view the balance sheet.) Prepare the production budget Reitw the sales budget you. Berared above Grady Tire Company Production Budget For the Year Ended December 31, 2019 First Second Third Fourth Quarter Quarter Quarter Quarter Total Budgeted tires to be sold 1,000 1,050 1.100 1,150 Plus: Desired tires in ending inventory 210 220 230 240 240 Total tires needed 1.210 1,270 1,330 1,390 4,540 Loss Tiren in beginning inventory 210 220 230 400 810 1,050 1,110 1180 4,140 Budgeted tires to be produced Prepare the direct materials budget. Review the production budget you prepared above. Grady Tiro Company 4,300 400 Choose from any list or enter any number in the input fields and then click Check Answer. 16 parts remaining Clear All Grady Tire Company Balance Sheet December 31, 2018 Assets Current Assets: Cash 65,000 Accounts Receivable 40,000 Raw Materials Inventory 5,600 14,000 Finished Goods Inventory Total Current Assets $ 124,600 Property, Plant, and Equipment: Equipment 177,000 (39,000) Less: Accumulated Depreciation 138,000 Total Assets $ 262,600 Liabilities Current Liabilities: Accounts Pavahle 6.000 Print Done 40,000 Accounts Receivable Raw Materials Inventory 5,600 14,000 $ 124,600 Finished Goods Inventory Total Current Assets Property, Plant, and Equipment: Equipment Less: Accumulated Depreciation 177,000 (39,000) 138,000 $ 262,600 Total Assets Liabilities 6,000 Current Liabilities: Accounts Payable $ Stockholders' Equity Common Stock, no par $ 150,000 106,600 Retained Earnings Total Stockholders' Equity $ Total Liabilities and Stockholders' Equity 256,600 262,600 Print Done More (Unless otherwise noted, assume all of the following events occurred during 2018 and that any balances given are stated as of December 31, 2018.) Budgeted sales are 1,000 tires for the first quarter and expected to increase by 50 tires per quarter. Cash a. sales are expected to be 40% of total sales, with the remaining 60% of sales on account. b. Finished Goods Inventory on December 31, 2018 consists of 400 tires at $35 each. Desired ending Finished Goods Inventory is 20% of the next quarter's sales; first quarter sales for 2020 are C. expected be 1,200 tires. FIFO inventory costing method is used. Raw Materials Inventory on December 31, 2018, consists of 800 pounds of rubber compound used to d. manufacture the tires. Direct materials requirements are 2 pounds of a rubber compound per tire. The cost of the compound is e. $7.00 per pound. Desired ending Raw Materials Inventory is 20% of the next quarter's direct materials needed for production; desired ending inventory for December 31, 2019 is 800 pounds; indirect materials are f. insignificant and not considered for budgeting purposes. g. Each tire requires 0.40 hours of direct labor, direct labor costs average $16 per hour. h. Variable manufacturing overhead is $2 per tire. Fixed manufacturing overhead includes $4,000 per quarter in depreciation and $14,630 per quarter for i. other costs, such as utilities, insurance, and property taxes. Fixed selling and administrative expenses include $12,500 per quarter for salaries; $3,600 per quarter for rent: $1,650 per quarter for insurance; and $500 per quarter for depreciation. k. Variable selling and administrative expenses include supplies at 1% of sales. Capital expenditures include $30,000 for new manufacturing equipment to be purchased and paid in the 1. first quarter. More Info - x e o Desired ending Raw Materials Inventory is 20% of the next quarter's direct materials needed for production; desired ending inventory for December 31, 2019 is 800 pounds; indirect materials are f. insignificant and not considered for budgeting purposes. g. Each tire requires 0.40 hours of direct labor, direct labor costs average $16 per hour. h. Variable manufacturing overhead is $2 per tire. Fixed manufacturing overhead includes $4,000 per quarter in depreciation and $14,630 per quarter for i. other costs, such as utilities, insurance, and property taxes. Fixed selling and administrative expenses include $12,500 per quarter for salaries: $3,600 per quarter for 1. rent; $1,650 per quarter for insurance; and $500 per quarter for depreciation. k. Variable selling and administrative expenses include supplies at 1% of sales. Capital expenditures include $30,000 for new manufacturing equipment, to be purchased and paid in the 1. first quarter. Cash receipts for sales on account are 60% in the quarter of the sale and 40% in the quarter following the sale: December 31, 2018, Accounts Receivable is received in the first quarter of 2019; uncollectible m. accounts are considered insignificant and not considered for budgeting purposes. Direct materials purchases are paid 50% in the quarter purchased and 50% in the following quarter, n. December 31, 2018, Accounts Payable is paid in the first quarter of 2019. o. Direct labor, manufacturing overhead, and selling and administrative costs are paid in the quarter incurred. p. Income tax expense is projected at $2,000 per quarter and is paid in the quarter incurred. Grady desires to maintain a minimum cash balance of $60,000 and borrows from the local bank as needed in increments of $1,000 at the beginning of the quarter, principal repayments are made at the beginning of the quarter when excess funds are available and in increments of $1,000; interest is 10% per year and q.. paid at the beginning of the quarter based on the amount outstanding from the previous quarter. 3 ad eld Print Done
