For example, in cell 826 enter the formula " B5 Check your worksheet by changing the budgeted unit sales $1,106,800, whereas the total cash disbursements 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 the year should be $1,095. . If you not get this answer, find the errors in your worksheet correct them. Year 3 Quarter Year 2 Quarter Data 4 2 3 1 2 70,000 80,000 Budgeted unit sales 40,000 60,000 100,000 50,000 Selling price per unit Accounts receivable, beginning balance Sales collected in the quarter sales are made Sales collected in the quarter after sales are made Desired ending finished goods inventory is Finished goods inventory, beginning Raw materials required to produce one unit Desired ending inventory of raw materials is Raw materia ls inventory, beginning Raw material costs Raw materials purchases are paid $8 per unit $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 and Accounts payable for raw materials, beginning balance Enter a formula into each of the cells marked with ? below Review Problem: Budget Schedules Year 2 Quarter Year 3 Quarter Construct the sales budget 1 2 3 1 2 Budgeted unit sales Selling price per unit ? ? ? ? ? ? ? ? ? ? Total sales ? Year 2 Quarter Construct the schedule of expected cash collections 1 2 3 Year Accounts receivable, beginning balance First-quarter sales Second-quarter sales Third-quarter sales Fourth-quarter sales Total cash colle ctions ? ? ? ? ? ? 7 2 Year 2 Quarter Year 3 Quarter Construct the production budget 1 2 3 Year 1 2 Budgeted unit sales Add desired fin ished goods inventory ? ? ? ? ? Total needs 2 ? 7 Less beginning inventory Required production ? ? ? ? ? 2 ? Year 3 Quarter Year 2 Quarter Construct the raw materials purchases budget 1 Year 4 3 2 1 ? ? ? Required production (units) Raw materials required to produce one unit Production needs (pounds) Add desired ending inventory of raw materials (pounds) Total needs (pounds) Less beginning inventory of raw materials (pounds) Raw materials to be purchased Cost of raw materials per pound Cost of raw materials to be purchased ? 7 ? ? 2 ? ? ? ? ? 7 ? 2 ? ? ? ? ? 2 2 2 2 Year 2 Quarter Construct the schedule of expected cash payments Year 4 3 2 1 ? Accounts payable, beginning balance First-quarter purchases Second-quarter purchases Third-quarter purchases Fourth-quarter purchases Total cash disbursements ? ? ? 2 ? ? ? ? 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 budget the Year 2 Quarter Year 3 Quarter 1 2 3 4 1 2 Data Budgeted unit sales Selling price per unit 50,000 70,000 120,000 75,000 $7 90,000 90,000 2 3 Data Year 3 Quarter 4 1 2 3 1 2 4 5 Budgeted unit sales 50,000 70,000 120,000 75,000 90,000 90,000 6 7 per unit Selling price per unit 8 $ 65,000 Accounts receivable, beginning balance Sales collected in the quarter sales are made 10 75% Sales collected in the quarter after sales are made 11 Desired ending finished goods inventory 25% 30% of the budgeted unit sales of the next quarter is 12 Finished goods inventory, beginning 13 Raw materials required to produce one unit 12,000 units 5 pounds Desired ending inventory of raw materials 14 10% of the next quarter's production needs is Raw materials inventory, beginning 23,000 pounds 0.80 per pound 60% in the quarter the purchases are made 40% in the quarter following purchase 15 Raw material costs S 16 Raw materials purchases are paid 17 and 18 19 Accounts payable for raw materials, beginning balance $ 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 the total cost of raw materials to be purchased for the year under this revised budget? c. What 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 90,000 units in any one quarter. Is this a potential problem? O No Yes Requirement 2: The company has just hired a new marketing mana dropping the selling price from $8 to $7. The marketing manager would like to use the following projections in the budget r who insists that unit sales can be dramatically increased by Year 2 Quarter Year 3 Quarter Data eted unit sales Selling price per unit 45,000 70, 000 120,000 65,000 85,000 90,000 $7 ... 2 Year 3 Quarter Data 1 2 4 1 2 4 5 Budgeted unit sales 45,000 70,000 120,000 65,000 85,000 90,000 6 S Selling price per unit 7 per unit 7 $ 65,000 Accounts receivable, beginning balance 9Sales collected in the quarter sales are made 75% Sales collected in the quarter after sales 10 25% are made Desired ending finished goods inventory 11 is 30% of the budgeted unit sales of the next quarter 12 Finished goods inventory, beginning 12,000 units Raw materials required to produce one 13 5 pounds unit Desired ending inventory of raw materials 14 10% of the next quarter's production needs is 23,000 pounds 0.80 per pound 60% in the quarter the purchases are made 40% in the quarter following purchase 15 Raw materials inventory, beginning Raw material costs 16 17 Raw materials purchases are paid and 18 Accounts payable for raw materials, 19 S 81,500 beginning balance a. What are the total expected cash collections for the year under this revised budget? Expected cash collections for the year b. What 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 90,000 units in any one quarter. Is this a potential problem? No Yes