For the cash budget:

Your interest on borrowings is incorrect. Keep in mind that you are borrowing in the beginning of the month and paying at the end of the next available month. You should also be using Excel to calculate the interest (i.e. set up a formula to calculate interest).

Your beginning cash balance for March does not equal your ending cash balance for February.

Waterways This is a continuation of the Waterways case from Chapters 1-8) WP9 Waterways Corporation is preparing its budget for the coming year, 2020. The first step is to plan for the first quarter of that coming year. The company has gathered information from its managers in preparation of the budgeting process. Sales Unit sales for November 2019 Unit sales for December 2019 Expected unit sales for January 2020 Expected unit sales for February 2020 Expected unit sales for March 2020 Expected unit sales for April 2020 Expected unit sales for May 2020 Unit selling price 112,500 102,100 113,000 112,500 116,000 125,000 137,500 Waterways likes to keep 10% of the next month's unit sales in ending inventory. All sales are on account, 85% of the Accounts Receivable are collected in the morth of sale, and 1 5% of the Accounts Receivable are collected in the month after sale. Accounts receiv- able on December 31, 2019, totaled $183,780 Direct materials cost 75 cents per pound Two pounds of direct materials are required to produce cach unit. waterways likes to keep 5% of the materials needed for the next month in its ending inventory. Raw Materials on December 31, 2019 totaled 11, 295 pounds. Payment for materials is made within 15 days, 50% is paid in the month of purchase, and 50% is paid in the month after purchase. Accounts Payable on December 31, 2019, totaled 120,595 Labor requires 12 minutes per unit for completion and is paid at a rate of $8 per hour Overhead 30e per labor hour Indirect materials Indirect labor Utilities Maintenance Salaries Depreciation Property taxes 50e per labor hour 45e per labor hour 25e per labor hour $42,000 per month $16,800 per month s 2,675 per month s 1,200 per month $ 1,300 per month Variable selling and administrative cost per unit is $1.60. $15,000 a month s 1,400 a month $72.000 a month $ 2,500 a month s 3,000 a month Salaries Depreciation Other fixed costs The Cash balance on December 31, 2019, totaled $100,500, but management has decided it would like to maintain a cash balance of at least $800,000 beginning on January 31 2020. Dividends are paid each month at the rate of $2.50 per share for 5,000 shares outstanding. The company has an open the agreement requires borrowing to be in $1,000 increments at 8% interest. Waterways borrows on the first day of the month and repays on the last day of the month. A $500,000 equipment purchase is planned for February Instructions For the first quarter of 2020, do the following. (a) Prepare a sales budget. (b) Prepare a production budget. (c) Prepare a direct materials budget. (Round to nearest dollar) (d) Prepare a direct labor budget. (For calculations, round to the nearest hour) (e) Prepare a manufacturing overhead budget. (Round amounts to the nearest dollar) () Prepare a selling and administrative budget. (g) Prepare a schedule for expected cash collections from customers. (h) Prepare a schedule for expected payments for materials purchases. (Round totals teo line of credit with Romney's Bank. The terms of nearest dollar) (i) Prepare a cash budget. Budgeted Number of unis Budgeted seling price Budgeted Sales December Sale January Sale February Sale $4,072.960 B) Budgeted Number of unis dd Desired Ending Inventory Budgeted Production Unts Budgeted Production Units Needed Per Add Desired Ending Inventory Budgeted Purchase Units Unit Price Of Material Total Budgeted Purchase December Purchane 72815 D) Hours Needed Per Unit Needed 180560 Budgeted Direct Labor Cost E) Total Janurary 0.45 025 Budgeted Overheads r2 F anurary Budgeted Number of Units 16 Variable Cost Fixed Cest 7.500 Budgeted Selling& Administrative Expese 279 500 February Accounts Receivable H) February Accounts Payable Total Payment 183 1,336 380 2,150026 69438 125 Cash For Mancring Ovehead Cash For Seling& Adminston Waterways This is a continuation of the Waterways case from Chapters 1-8) WP9 Waterways Corporation is preparing its budget for the coming year, 2020. The first step is to plan for the first quarter of that coming year. The company has gathered information from its managers in preparation of the budgeting process. Sales Unit sales for November 2019 Unit sales for December 2019 Expected unit sales for January 2020 Expected unit sales for February 2020 Expected unit sales for March 2020 Expected unit sales for April 2020 Expected unit sales for May 2020 Unit selling price 112,500 102,100 113,000 112,500 116,000 125,000 137,500 Waterways likes to keep 10% of the next month's unit sales in ending inventory. All sales are on account, 85% of the Accounts Receivable are collected in the morth of sale, and 1 5% of the Accounts Receivable are collected in the month after sale. Accounts receiv- able on December 31, 2019, totaled $183,780 Direct materials cost 75 cents per pound Two pounds of direct materials are required to produce cach unit. waterways likes to keep 5% of the materials needed for the next month in its ending inventory. Raw Materials on December 31, 2019 totaled 11, 295 pounds. Payment for materials is made within 15 days, 50% is paid in the month of purchase, and 50% is paid in the month after purchase. Accounts Payable on December 31, 2019, totaled 120,595 Labor requires 12 minutes per unit for completion and is paid at a rate of $8 per hour Overhead 30e per labor hour Indirect materials Indirect labor Utilities Maintenance Salaries Depreciation Property taxes 50e per labor hour 45e per labor hour 25e per labor hour $42,000 per month $16,800 per month s 2,675 per month s 1,200 per month $ 1,300 per month Variable selling and administrative cost per unit is $1.60. $15,000 a month s 1,400 a month $72.000 a month $ 2,500 a month s 3,000 a month Salaries Depreciation Other fixed costs The Cash balance on December 31, 2019, totaled $100,500, but management has decided it would like to maintain a cash balance of at least $800,000 beginning on January 31 2020. Dividends are paid each month at the rate of $2.50 per share for 5,000 shares outstanding. The company has an open the agreement requires borrowing to be in $1,000 increments at 8% interest. Waterways borrows on the first day of the month and repays on the last day of the month. A $500,000 equipment purchase is planned for February Instructions For the first quarter of 2020, do the following. (a) Prepare a sales budget. (b) Prepare a production budget. (c) Prepare a direct materials budget. (Round to nearest dollar) (d) Prepare a direct labor budget. (For calculations, round to the nearest hour) (e) Prepare a manufacturing overhead budget. (Round amounts to the nearest dollar) () Prepare a selling and administrative budget. (g) Prepare a schedule for expected cash collections from customers. (h) Prepare a schedule for expected payments for materials purchases. (Round totals teo line of credit with Romney's Bank. The terms of nearest dollar) (i) Prepare a cash budget. Budgeted Number of unis Budgeted seling price Budgeted Sales December Sale January Sale February Sale $4,072.960 B) Budgeted Number of unis dd Desired Ending Inventory Budgeted Production Unts Budgeted Production Units Needed Per Add Desired Ending Inventory Budgeted Purchase Units Unit Price Of Material Total Budgeted Purchase December Purchane 72815 D) Hours Needed Per Unit Needed 180560 Budgeted Direct Labor Cost E) Total Janurary 0.45 025 Budgeted Overheads r2 F anurary Budgeted Number of Units 16 Variable Cost Fixed Cest 7.500 Budgeted Selling& Administrative Expese 279 500 February Accounts Receivable H) February Accounts Payable Total Payment 183 1,336 380 2,150026 69438 125 Cash For Mancring Ovehead Cash For Seling& Adminston