Assignment #4 Developing a Master Budget

• 		Budgeted sale for the next 12 month
  		Jan	30000
  Selling Price:	$12	Feb	55000
  Expected collections are to be 50% in the month of the sale	50%	March	40000
  30 % in the first month following the sale	30%	April	30000
  30 % in the scond of month following the sale	20%	May	35000
  produaction:	20%	June	25000
  monthly units sale :	600 units	July	20000
  DM Purchases:	60%	Aug	15000
  Matrial Cost	$0.60
  Cost of Good Sold	60%	Sep	25000
  Selling and Admin a month	$1,000	Oct	50000
  desired ending inventory of next month of sales	20%	Nov	45000
  payment pattern of purchase paid in the month	40%	Dec	30000
  payment pattern of purchase paid in the next month	60%
  epuipment purchase: March 2020	$10,000
  dividend paid	$2,000
  Selling and Admin per month	$40,000
  equipment balance December 31, 2019	$60,000
  Accumulated depreciation straight line,	5 years
  common stack	$6,000
  line of credit	1%

• 12-month multi-period
• All sales are on accounts
• Expected collections are to be 50% in the month of the sale
• , 30 % in the first month following the sale
• 20% in the second month following the sale.
• Production the company will end each month with sufficient inventory to cover 20% of the following months sales. The new year started with 600 units in stock and plan to finish each year with 825 units in stock.
• It pays 60% of direct materials purchase in cash in the month of purchase and the balance is due in the month following the purchase. It pays all other items above in the month incurred, except for selling and administrative expenses that include $1,000 of amortization per month.
• Cost of Goods Sold: 60% of the sale and desired ending inventory 20% of next months sale
• Payment Pattern: 40% of purchases paid in the month of the purchase and 60% paid in the next month.
• Cash in Bank January 2020 is $20,000.
• The company expected to purchase equipment in March 2020 for $10,000.
• Dividend paid per quarter $2,000.
• Selling and administration expenses per month $ 40,000.
• The equipment balance as of December 31, 2029, is $60,000. Accumulated depreciation straight line; 5 years
• Common stock is $ 6,000

The company has access to a line of credit with the bank with the following terms interest rate is 1% per month on the first day of the month, the interest payable is calculated at 1% of the previous months outstanding balance. Borrowings in a given month are taken out at the beginning of the month.

1. The company wishes to maintain a minimum balance of $10,000 at all times.
2. Ensure that your total boxes correctly total up the rows in your columns.