Complete Manufacturing overhead budget, Ending Finished Goods Inventory Budget, and Selling and administrative Expense Budget(excel) using this information
\fWinter 2020 ACCT 3224 - 006 Group Budget Assignment 11. Sales in February and March 2020 are expected to be $700,000 and $1,500,000 respectively. Based on the above collection pattern this will result in Acco Receivable of $734,000 at March 31, 2020 which will be collected in April and May 2020. 12. During the fiscal year ended March 31, 2021, DPI will be required to make monthly income tax installment payments of $5,000. Outstanding income taxes from the year ended March 31, 2020 must be paid in July 2020. Income tax expense is estimated to be 25% of net income. Income taxes for the year ended March 31, 2021, in excess of installment payments, will be paid in July, 2021. 13. DPI is planning to acquire additional manufacturing equipment for $204,300 cash. 40% of this amount is to be paid in February 2021, the rest, in March 2021. The manufacturing overhead costs shown above already include the depreciation on this equipment. 14. An arrangement has been made with the local bank that if DPI maintains a minimum balance of $20,000 in their bank account, they will be given a line of credit at a preferred rate of 2% per annum. All borrowing is considered to happen on the first day of the month, repayments are on the last day of the month. All borrowings and repayments from the bank should be in multiples of $1,000 and interest must be paid at the end of each month. Interest is calculated on the balance at the beginning of the month, which includes any amounts borrowed that month. 15. DPI Ltd. has a policy of paying dividends at the end of each quarter. The president tells you that the board of directors is planning on continuing their policy of declaring dividends of $100,000 per quarter. 16. A listing of the estimated balances in the company's ledger accounts as of March 31, 2020 is given below: Assets Cash $ 83,365 Accounts receivable 734,000 Inventory-raw materials 9,000 Inventory-finished goods 9, 125 Prepaid Insurance 64,000 Prepaid property and business taxes 19,200 Capital assets (net) 724,000 Total assets $1,642.690 Liabilities and Shareholders' Equity Accounts payable $ 208,407 Income taxes payable 21,500 Capital stock 1,000,000 Retained Earnings 412,783 Total liabilities and shareholders' equity $1,642,690 Required (see over)Winter 2020 ACCT 3224 - 006 Group Budget Assignment 6. DPI's manufacturing process is highly automated, so their direct labour cost is low. Employees are paid on a per unit basis. Their total pay each month is, therefore, dependent on production volumes and averages $8.75 per hour. This rate already includes the employer's portion of employee benefits. All payroll costs are paid in the period in which they are incurred. Each unit spends a total of 15 minutes in production. 7. Due to the similarity of the equipment in each of the production stages and the company's concentration on a single product, manufacturing overhead is allocated based on volume (i.e. the units produced). The unit variable overhead manufacturing rate is $1.30, consisting of: Utilities--$0.60; Indirect Materials--$0.20; Plant maintenance--$0.30; environmental fee--$0.14; and Other--$0.06. 8. The fixed manufacturing overhead costs for the entire year are as follows: Training and development $ 55,200 Property and business taxes 39,000 Supervisor's salary 135,400 Amortization on equipment 168,800 Insurance 96,000 Other 110,600 $ 605,000 The property and business taxes are paid on Sept 30 of each year. The expected payment for next year is $42,000. The annual insurance premium is paid at the beginning of December each year. There should be no change in the premium from last year. All other "cash-related" fixed manufacturing overhead costs are incurred evenly over the year and paid as incurred. . DPI uses the straight line method of depreciation. 9. Selling and administrative expenses are known to be a mixed cost; however, there is a lot of uncertainty about the portion that is fixed. Previous year's experience has provided the following information: Lowest level of sales: 375,000 units Total Operating Expenses: $778,710 Highest level of sales: 750,000 units Total Operating Expenses: $1,022,460 These costs are paid in the month in which they occur. Bad debts expense is not included in the above expense amounts. 10. Sales are on a cash and credit basis, with 55% collected during the month of the sale, 35% the following month, and 9.5% the month thereafter. 1/2 of 1% of sales are considered uncollectible (bad debts expense).Winter 2020 ACCT 3224 - 006 Group Budget Assignment Deeney Products Inc. Deeney Products Inc. (DPI) is a company that manufactures and sells a single product, called a "Man You". For planning and control purposes they utilize a monthly master budget, which is usually developed at a few months in advance of the budget year (April 2020 to March, 2021). Their fiscal year end is March 31. The following details are provided to assist you in preparing the required budget. The sales forecasts for three budget years is estimated as follows: . . For the year ended March 31, 2020: 475,000 units at $12.00 each* For the year ended March 31, 2021: 500,000 units at $12.00 each For the year ended March 31, 2022: 500,000 units at $12.00 each *Expected sales for the year ended March 31, 2020 are based on actual sales to date and budgeted sales for the duration of the year. Your conversations with the president and your investigations of the company's records have revealed the following information: 1. Peak months for sales correspond with gift-giving holidays. History shows that January, March, May and June are the slowest months with only 1% of sales for each month. Sales pick up over the summer with July, August and September each contributing 2% to the total. Valentines Day in February boosts sales to 5%, and Easter in April accounts for 10%. As Christmas shopping picks up momentum, winter sales start at 15% in October, move to 20% in November and then peak at 40% in December. This pattern of sales is not expected to change in the next two years. 2. From previous experience, management has determined that an ending inventory equal to 25% of the next month's sales is required to fit the buyer's demands. 3 . Because sales are seasonal, DPI must rent an additional storage facility in the peak period from September to December to house the additional inventory on hand. The only related cost is a flat $20,000 per month, payable at the beginning of the month. 4. There is only one type of raw material used in the production of "Man Yous". Space- age acrylic (SAA) is a very compact material that is purchased in powder form. Each "Man You" requires 5 kilograms of SAA, at a cost of $0.55 per kilogram. The supplier of SAA tends to be somewhat erratic so DPI finds it necessary to maintain an inventory balance equal to 40% of the following month's production needs as a precaution against stock-outs. DPI pays for 20% of a month's purchases in the month of purchase, 45% in the following month and the remaining 35% two months after the month of purchase. There is no early payment discount. 5. Beginning accounts payable in April 2020 will consist of $208,406.50 arising from the following estimated direct material purchases for February and March of 2020: SAA purchases in February 2020: $225,875.00 SAA purchases in March 2020 $163,563.50
