Assignment Instructions

You have been hired as the new budget controller for Banderhouse Inc., a manufacturing firm that makes insulated pet houses from injected molded plastic. The firm has been in business for two years and currently makes one product, the Deluxe house. You are tasked with creating a master budget for the first quarter. It will consist of the operating budget and the financial budget with the following components:

$1.$ Sales budget

$2.$ Production budget

$3.$ Direct materials purchase budget

$4.$ Direct labor budget

$5.$ Overhead budget

$6.$ Selling and administrative expenses budget

$7.$ Ending finished goods inventory budget

$8.$ Cost of goods sold budget

$9.$ Budgeted income statement

$10.$ Cash budget

In a $400-800-$word document, present your master budget to the company executives. It should include a title page with your name, company name, course name and submission date. All budgets should be in table format. An explanatory narrative should be included to describe computations made in each budget. Each narrative should be placed next to its corresponding budget table. Pertinent Information

Unit selling price $$235$

Projected sales in units for the first quarter

Direct labor usage data:

Direct material usage data:

Inventory policy requires that there are sufficient materials on hand at the beginning of the month to produce $50\%$ of that months

estimated sales. This was the case on January $1.$Monthly overhead data:

Monthly overhead is estimated using a flexible budget formula and is measured in direct labor hours.

Monthly selling and administrative data:

Monthly selling and administrative expenses are estimated using a flexible budget formula and are measured in units sold.

Finished goods inventory:

Desired ending inventory for each month is $80$ percent of next month's sales.Desired ending inventory for each month is $80$ percent of next month's sales.Pertinent Information

Unit selling price $$235$

Projected sales in units for the first quarter

Direct labor usage data:

Direct material usage data:

Inventory policy requires that there are sufficient materials on hand at the beginning of the month to produce $50\%$ of that months

estimated sales. This was the case on January $1.$

All sales and purchases are for cash. The cash balance on January $1$ was $$500,000.$ Banderhouse Inc. requires a minimum month cash balance of $$1000.$ If there is a cash shortage, money is borrowed at a rate of $10$ percent and is repaid at the end of the quarter along with the interest due. Cash borrowed at the end of the quarter is repaid at the end of the following quarter. On January $1,$ there were no loans.