B C D E G H 1 Year 2 Quarter 2 3 60,000 100,000 4 50,000 Year 3 Quarter 2 70,000 80,000 40,000 13 . $8 $65,000 75% 25% 30% of the budgeted unit sales of the next quarter 12,000 units 5 pounds 10% of the next quarter's production needs 23,000 pounds $0.80 per pound 60% in the quarter the purchases are made 40% in the quarter following purchase $81,500 A 1 Chapter 8: Applying Excel 2 3 Data 4 5 Budgeted unit sales 6 7. Selling price per unit 8. Accounts receivable, beginning balance 9 Sales collected in the quarter sales are made 10. Sales collected in the quarter after sales are made 11 . Desired ending finished goods inventory is 12 . Finished goods inventory, beginning Raw materials required to produce one unit 14 Desired ending inventory of raw materials is 15. Raw materials inventory, beginning 16. Raw material costs 17 . Raw materials purchases are paid 18 and 19 Accounts payable for raw materials, beginning balance 20 21 Enter a formula into each of the cells marked with a ? below 22 Review Problem: Budget Schedules 23 24 Construct the sales budget 25 26 Budgeted unit sales 27 Selling price per unit 28 Total sales 29 30 Construct the schedule of expected cash collections 31 32 Beginning balance accounts receivable 33 First-quarter sales 34 Second-quarter sales 35 Third-quarter sales 36 Fourth-quarter sales 37 Total cash collections 38 39 Construct the production budget 40 41 Budgeted unit sales 42 Add desired ending finished goods inventory 43 Total needs 44 Less beginning finished goods inventory 45 Required production in units 46 47 Construct the raw materials purchases budget Year 3 Quarter 1 2 4 2 Year 2 Quarter 3 ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? Year 2 Quarter 2 3 1 4 Year ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? Year 2 Quarter Year 3 Quarter 2 1 2 3 4 Year 1 ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? Year 2 Quarter Year 3 Quarter Year 2 Quarter 2 3 1 Year 29 0 Construct the schedule of expected cash collections 31 32 Beginning balance accounts receivable 3 First-quarter sales 4 Second-quarter sales 35 Third-quarter sales 36 Fourth-quarter sales 7 Total cash collections ? ? ? ? ? ? ? ? ? cla 2 ? ? 38 Year 2 Quarter 3 1 2 4 Year ? ? ? ? ? ? ? ? ? ? ? ? Year 3 Quarter 1 2 ? ? ? ? ? ? ? ? ? ? ? ? ? Year 2 Quarter Year 3 Quarter 1 2 3 4 Year 1 ? ? ? ? ? ? ? ? 39 Construct the production budget 10 31 Budgeted unit sales 22 Add desired ending finished goods inventory 13 Total needs 14 Less beginning finished goods inventory 35 Required production in units 16 17 Construct the raw materials purchases budget 18 19 Required production (units) 50 Raw materials required to produce one unit (pounds) 51 Production needs (pounds) 2 Add desired ending inventory of raw materials (pounds) 53 Total needs (pounds) 54 Less beginning inventory of raw materials (pounds) 55 Raw materials to be purchased (pounds) 56 Cost of raw materials per pound 57 Cost of raw materials to be purchased 58 59 Construct the schedule of expected cash payments 50 51 Beginning balance accounts payable 52 First-quarter purchases 53 Second-quarter purchases 54 Third-quarter purchases 55 Fourth-quarter purchases 56 Total cash disbursements ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? Year 2 Quarter 2 1 3 4 Year ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? 57 Required information Chapter 8: Applying Excel (LO8-2, LO8-3, LO8-4) Step 1: Download the Applying Excel form located on the left-hand side, under files. Step 2: Then enter formulas in all cells that contain question marks. For example, in cell B26 enter the formula "=B5". Step 3: Check your worksheet by changing the budgeted unit sales in Quarter 2 of Year 2 in cell C5 to 75,000 units. The required production for the year should be 274,000 units. The cost of raw materials to be purchased for the year should be $1,106,800, whereas the total cash disbursements for the year should be $1,095,980. If you do not get this answer, find the errors in your worksheet and correct them. Step 4: Proceed to the requirements below only after completing your worksheet as it will be used to answer the following questions. Chapter 8: Applying Excel: Exercise Requirement 2: The company has just hired a new marketing manager who insists that unit sales can be dramatically increased by dropping the selling price from $8 to $7. The marketing manager would like to use the following projections in the budget: Data Budgeted unit sales Selling price per unit 4 Year 2 Quarter 2 70,000 110,000 1 50,000 Year 3 Quarter 1 2 90,000 100,000 60,000 A B D E F 1 Chapter 8: Applying Excel 2 3 Data 4 1 4 2 70,000 3 110,000 Year 3 Quarter 1 90,000 2 100,000 5 Budgeted unit sales 50,000 60.000 3 Data Year 3 Quarter 4 1 2 3 4 1 2 5 Budgeted unit sales 50,000 70,000 110,000 60,000 90.000 100,000 6 $ 7 per unit 65.000 $ 7 Selling price per unit 8 Accounts receivable, beginning balance 9 Sales collected in the quarter sales are made 10 Sales collected in the quarter after sales are made 11 Desired ending finished goods inventory is 12 Finished goods inventory, beginning 13 Raw materials required to produce one unit 14 Desired ending inventory of raw materials is 15 Raw materials inventory, beginning 16 Raw material costs 17 Raw materials purchases are paid 18 and 19 Accounts payable for raw materials, beginning balance 75% 25% 30% of the budgeted unit sales of the next quarter 12,000 units 5 pounds 10% of the next quarter's production needs 23,000 pounds 0.80 per pound 60% in the quarter the purchases are made 40% in the quarter following purchase 81,500 $ $ a. What are the total expected cash collections for the year under this revised budget? Expected cash collections for the year b. What is the total required production for the year under this revised budget? Total required production for the year c. What is the total cost of raw materials to be purchased for the year under this revised budget? Total cost of raw materials to be purchased for the year d. What are the total expected cash disbursements for raw materials for the year under this revised budget? Total expected cash disbursements for raw materials for the year e. After seeing this revised budget, the production manager cautioned that due to the current production constraint, a complex milling machine, the plant can produce no more than 80,000 units in any one quarter. Is this a potential problem? O Yes O No