Cash Budget and Income Statement

Master Budget Case: CamDrone As part of the continued advancement of technology, a drone camera market has emerged in recent years. The drone camera market has been growing as more photography enthusiasts have begun adopted this high-tech approach to capturing still images and video using remotely controlled devices. Eager to capture a share of this growing market, CamDrone entered the market in early 2018. CamDrone manufactures camera drones, selling primarily to retailers. CamDrone is pleased with its financial performance over its first few years of operations, optimistic to achieve continued financial success. For planning and control purposes the company utilizes a monthly master budget, which is usually developed at least three months in advance of the budget year. The company has a fiscal year ending December 31. You are to prepare the Master Budget for the year ending December 31, 2023. Based on your discussions with the various departments throughout the company, you have collected the following relevant information for preparing the budget: Sales 1. The marketing department is forecasting the following annual sales: - For the year ended December 31, 2022: 9,000 units at $1,000 each* - For the year ended December 31, 2023: 10,000 units at $1,000 each - For the year ended December 31, 2024: 15,000 units at $1,000 each - Expected sales for the year ended December 31,2022 were based on actual sales to date and budgeted sales for the duration of the year. 2. Peak months for sales generally correspond with summer weather and gift-giving holidays. History shows that January is the slowest month, with only 1% of annual sales, followed closely behind by Feb-April with 2% of annual sales for each month. Sales spike during summer months with May, June, July, and August contributing As modified by Wayne Singular for use in BUSN 5030 for the Fall 2022 Semester at Thompson Rlivers University Required: (25 marks) Using the Excel spreadsheet provided by the Controller, prepare a monthly master budget for CamDrone for the year ending December 31,2023 , including the following schedules: - Sales Budget \& Schedule of Expected Cash Collections - Direct Materials Budget \& Schedule of Expected Cash Disbursements - Direct Labour Budget - Production Budget \& Manufacturing Overhead Budget - Selling and Administrative Expense Budget - Cash Budget - Contribution Margin Income Statement For calculation of COGS and ending Finished Goods inventory, carry the MOH cost/unit to 0 decimal places \begin{tabular}{l|l} 11 \\ 12 \\ 13 & Sakes pattern \\ 14 \end{tabular} \begin{tabular}{|c|c|c|} \hline 13 & Jaks pattor & 1% \\ \hline 15 & Feb & 2% \\ 16 & Mar & 2% \\ 17 & Apr & 2% \\ 18 & May & 12% \\ 19 & Jun & 15% \\ 20 & Jul & 12% \\ 21 & Aug & 10% \\ 22 & Sop & 3% \\ \hline 23 & Oct & 8% \\ 24 & Nor & 13% \\ 25 & Dec & 20% \\ \hline 26 & & 100% \\ \hline 27 & & \end{tabular} desired ending inventory (finished goods) 25% of next month's sales Raw material kg required for each unit of product 2022 1.252023 increase from list year 31 cost por kilogram - 2021 actual 40% next month's production neods. desired ending inventory (raw materials) \begin{tabular}{l} \hline 20% in the month of purchase \\ 50% in the month following the purchase \\ 30% in the 2 nd month following the purchase \end{tabular} Beginning Accounts Payable: 90) totnl MOH $2,142,500 Selling and Admin - no prepaid expenses Lowest lovel of sales Highest lovel of sales 80 total operating expenses $87,270 1,600 total operating expenses 360,780 Per unit fixed $179941 $72,875 or 6,073 per month - 2021 Increase expected 3% for both the fixed and variable amounts per unit fixed $185,339 rental cost-Admn \& Selling cost May June July August Nov Dec 75,061 Sales collection pattem \begin{tabular}{l|l|} \hline current month & 49.0% \\ following month & 33.0% \\ 2 months affer & 17.0% \end{tabular} uncollectible 1.0% recognized in the month of original sale-example: January sales in January Master Budget Case: CamDrone As part of the continued advancement of technology, a drone camera market has emerged in recent years. The drone camera market has been growing as more photography enthusiasts have begun adopted this high-tech approach to capturing still images and video using remotely controlled devices. Eager to capture a share of this growing market, CamDrone entered the market in early 2018. CamDrone manufactures camera drones, selling primarily to retailers. CamDrone is pleased with its financial performance over its first few years of operations, optimistic to achieve continued financial success. For planning and control purposes the company utilizes a monthly master budget, which is usually developed at least three months in advance of the budget year. The company has a fiscal year ending December 31. You are to prepare the Master Budget for the year ending December 31, 2023. Based on your discussions with the various departments throughout the company, you have collected the following relevant information for preparing the budget: Sales 1. The marketing department is forecasting the following annual sales: - For the year ended December 31, 2022: 9,000 units at $1,000 each* - For the year ended December 31, 2023: 10,000 units at $1,000 each - For the year ended December 31, 2024: 15,000 units at $1,000 each - Expected sales for the year ended December 31,2022 were based on actual sales to date and budgeted sales for the duration of the year. 2. Peak months for sales generally correspond with summer weather and gift-giving holidays. History shows that January is the slowest month, with only 1% of annual sales, followed closely behind by Feb-April with 2% of annual sales for each month. Sales spike during summer months with May, June, July, and August contributing As modified by Wayne Singular for use in BUSN 5030 for the Fall 2022 Semester at Thompson Rlivers University Required: (25 marks) Using the Excel spreadsheet provided by the Controller, prepare a monthly master budget for CamDrone for the year ending December 31,2023 , including the following schedules: - Sales Budget \& Schedule of Expected Cash Collections - Direct Materials Budget \& Schedule of Expected Cash Disbursements - Direct Labour Budget - Production Budget \& Manufacturing Overhead Budget - Selling and Administrative Expense Budget - Cash Budget - Contribution Margin Income Statement For calculation of COGS and ending Finished Goods inventory, carry the MOH cost/unit to 0 decimal places \begin{tabular}{l|l} 11 \\ 12 \\ 13 & Sakes pattern \\ 14 \end{tabular} \begin{tabular}{|c|c|c|} \hline 13 & Jaks pattor & 1% \\ \hline 15 & Feb & 2% \\ 16 & Mar & 2% \\ 17 & Apr & 2% \\ 18 & May & 12% \\ 19 & Jun & 15% \\ 20 & Jul & 12% \\ 21 & Aug & 10% \\ 22 & Sop & 3% \\ \hline 23 & Oct & 8% \\ 24 & Nor & 13% \\ 25 & Dec & 20% \\ \hline 26 & & 100% \\ \hline 27 & & \end{tabular} desired ending inventory (finished goods) 25% of next month's sales Raw material kg required for each unit of product 2022 1.252023 increase from list year 31 cost por kilogram - 2021 actual 40% next month's production neods. desired ending inventory (raw materials) \begin{tabular}{l} \hline 20% in the month of purchase \\ 50% in the month following the purchase \\ 30% in the 2 nd month following the purchase \end{tabular} Beginning Accounts Payable: 90) totnl MOH $2,142,500 Selling and Admin - no prepaid expenses Lowest lovel of sales Highest lovel of sales 80 total operating expenses $87,270 1,600 total operating expenses 360,780 Per unit fixed $179941 $72,875 or 6,073 per month - 2021 Increase expected 3% for both the fixed and variable amounts per unit fixed $185,339 rental cost-Admn \& Selling cost May June July August Nov Dec 75,061 Sales collection pattem \begin{tabular}{l|l|} \hline current month & 49.0% \\ following month & 33.0% \\ 2 months affer & 17.0% \end{tabular} uncollectible 1.0% recognized in the month of original sale-example: January sales in January