A.General Corporation manufactures boxes. The estimated number of boxes sold for the first three months of 2021 are:

Month

Sales

January

3,000

February

4,200

March

3,900

Finished goods inventory at the end of December was 900 units. Ending finished goods inventory is equal to 20 percent of the next month's sales. General Corporation expects to sell the boxes for P5 each. April 2021 sales is projected at 4,500 boxes.

1.What is the expected sales revenue for March?

Answer

2.How many boxes should be produced in February?

Answer

boxes

3.How many boxes should be produced in January?

Answer

boxes

B.Harrison Company manufactures card tables. The company has a policy of maintaining a finished goods inventory equal to 40 percent of the next month's planned sales. Each card table requires 3 hours of labor. The budgeted labor rate for the coming year is P13 per hour. Planned sales for the months of April, May, and June are respectively 4,000; 5,000; and 3,000 units.

4.What is Harrison Company's budgeted direct labor cost for May?

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C.Edwards Company has the following expected pattern of collections on credit sales: 70 percent collected in the month of sale, 15 percent in the month after the month of sale, and 14 percent in the second month after the month of sale. The remaining 1 percent is never collected.

At the end of May, Edwards Company has the following accounts receivable balances:

Edwards expected sales for June are P150,000.

5.How much cash will Edwards Company expect to collect in June?

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D.For the month of October, P Corp. predicts total cash collections to be P1 million. Also for October, P Corp. estimates that its beginning cash balance will be P50,000 and that it will borrow cash in the amount of P70,000.

6.IfP Corp. estimates an ending cash balance of P30,000 for October, what must its projected cash disbursements be?

Answer

E.Esterwood Hospital has provided you with the following budget information for April:

Cash collections

P876,000

April 1 cash balance

23,000

Cash disbursements

978,600

Esterwood has a policy of maintaining a minimum cash balance of P20,000 and borrows only in P1,000 increments.

7.How much will Esterwood borrow in April?

Answer

F.The manufacturing overhead budget at Blink Corporation is based on budgeted direct labor-hours. The direct labor budget indicates that 6,000 direct labor-hours will be required in February. The variable overhead rate is P3.40 per direct labor-hour. The company's budgeted fixed manufacturing overhead is P81,600 per month, which includes depreciation of P18,000. All other fixed manufacturing overhead costs represent current cash flows.

8.How much is total manufacturing overhead?

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9.The company recomputes its predetermined overhead rate every month. The predetermined overhead rate for February should be:

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G.Pink Corporation makes and sells a product called a Miniwarp. One Miniwarp requires 2.5 kilograms of the raw material Jurislon. Budgeted production of Miniwarps for the next five months is as follows:

August20,000 units

September20,900 units

October20,800 units

November20,600 units

December21,300 units

The company wants to maintain monthly ending inventories of Jurislon equal to 20% of the following month's production needs. On July 31, this requirement was not met since only 9,700 kilograms of Jurislon were on hand. The cost of Jurislon is P5.00 per kilogram. The company wants to prepare a Direct Materials Purchase Budget for the next five months.

10.How much is the amount of the desired ending inventory of Jurislon for the month of September?

11.How much is the total cost of Jurislon to be purchased in August?

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12.How much is the total disbursement for purchases in September?

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