Can I get some help question? I have been asked a question similar to this and am not sure how to format certain schedules and what to include. I have the sales budget and collections. The overhead budget is a little rough and I am unsure of what to include in it. So far I have the sales budget, collections, production, direct materials, disbursements, direct labor, overhead (fixed and variable), selling and administrative. I think there needs to be a cash budget as well but I haven't gotten there. I've attempted each budget schedule but the balance sheet is off. Help needed. Here is the relevant info....

Balance Sheet as of December 31st

Assets

Cash: 5080

Accts Receivable: 26500

Raw Materials Inventory: 2000

Finished Goods Inventory: 2680

Prepaid Insurance: 1200

Building: 300000

Acc Depreciation: 20000

Total Assets: 317460

Liabilities and Equity

Notes Payable: 25000

Accts Payable 2148

Dividends Payable: 10000

Total Liabilities: 37148

Common Stock: 100000

Paid-in capital: 50000

Retained Earnings: 130312

Total Liabilities and Equity: 317460

The accts receivable balance represents the remaining balances of November and December credit sales which were 70000 and 65000 respectively.

Estimated sales in gallons (of dye) for jan-may

Jan- 8000

feb- 10000

mar- 15000

apr- 12000

may- 11000

each gallon sells for 12.75

Collection patterns: 70% is collected in the month of the sale, 20% in the month after the sale, and 10% two months after the sale

this company expects no bad debts and gives no cash discounts

Each gallon of dye has the following standard costs and quantities for DM and DL

Quantity cost/rate std cost

DM 1.20 $ 2.00 $2.40

DL .25 $12 $3.00

some evaporation loss happens during processing. VOH is applied on the basis of machine hours. the processing of one gallon of dye takes 5MH. the variable overhead rate is $ 0.06. VOH is entirely of utility costs. FOH is applied per gallon based on an expected annual capacity of 120000 gallons.

Fixed overhead is incurred evenly throughout the year and composed of the following costs.

Salaries: 78000

Utilities: 12000

Insurance-factory: 2400

Depreciation-factory: 27600

There is no beginning work in process inventory. All WIP is completed in the period it started. Raw materials inventory at the start of the year is 1000 gallons of mordant (the direct material) There are 400 gallons of dye in finished goods inventory at the beginning of the year carried at standard cost

Accounts payable only relates to raw material and is paid 60% in the month of the purchase and 40% in the month after. no discounts are given for prompt payment.

the dividend will be paid in january

A new piece of equipment that cost 10000 is bought of march 1st. payment of 60% will be made in march and the other 40% in april. It has a life of 3 years and no salvage value. The equipment will be placed into service april 2nd.

The note payable has a 6% interest rate, interest is to be paid at the end of each month. the principal of the note is repaid as cash is available to do so

The firms management has set a minimum cash balance of 5000. Investments and borrowings are made in 1000 increments. the line of credit is 9% per year

The ending finished goods inventory should include 25% of next months needs. the ending inventory of raw materials should be 20% of next months needs. this isn't true at the start of january due to a miscalculation in sales for december

Monthly selling and admin costs are paid in cash. these are the per month costs

Salaries: 18000

utilites: 800

Office rent: 7000

My question asks to prepare a master budget month by month for the first quarter including quarterly totals and the pro forma income statement and balance sheet as of march 31st.

I have most of these budget schedules laid out but I am not sure if I have all of them and if they are formatted correctly. This is why my balance sheet is a bit off still. I feel like I am close and able to apply most of this information but the manufacturing overhead budget and the SG&a budgets are giving me trouble. Thank you!