Question
for some reason I been struggling with this chapter of the course. I have other homeworks that are similar to this and i almost always
for some reason I been struggling with this chapter of the course. I have other homeworks that are similar to this and i almost always end up getting error after error. so i copied and pasted the whole question from beginning to end and attached the pictures of the graphs that i was supposed to fill out. Any chance you could show me how we supposed to do from start to end and how it lead to the other so i could try do same with other similar questions in my assignments? thank you!!
Milo Company manufactures beach umbrellas. The company is preparing detailed budgets for the third quarter and has assembled the following information to assist in the budget preparation:
a. The Marketing Department has estimated sales as follows for the remainder of the year (in units):
July 32,000 October 22,000
August 74,000 November 8,500
September 43,000 December 9,000
The selling price of the beach umbrellas is $13 per unit.
b. All sales are on account. Based on past experience, sales are collected in the following pattern:
30%in the month of sale
65%in the month following sale
5% uncollectible
Sales for June totaled $299,000.
c. The company maintains finished goods inventories equal to 15% of the following month's sales. This requirement will be met at the end of June.
d. Each beach umbrella requires 4 feet of Gilden, a material that is sometimes hard to acquire. Therefore, the company requires that the ending inventory of Gilden be equal to 50% of the following month's production needs. The inventory of Gilden on hand at the beginning and end of the quarter will be:
June 30 76,600 feet
September 30 ? feet
e. Gilden costs $0.80per foot. One-half of a month's purchases of Gilden is paid for in the month of purchase; the remainder is paid for in the following month. The accounts payable on July 1 for purchases of Gilden during June will be $50,120.
Required:
1. Calculate the estimated sales, by month and in total, for the third quarter.
2. Calculate the expected cash collections, by month and in total, for the third quarter.
3. Calculate the estimated quantity of beach umbrellas that need to be produced in July, August, September, and October.
4. Calculate the quantity of Gilden (in feet) that needs to be purchased by month and in total, for the third quarter.
5. Calculate the cost of the raw material (Gilden) purchases by month and in total, for the third quarter.
6. Calculate the expected cash disbursements for raw material (Gilden) purchases, by month and in total, for the third quarter.
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