General Instructions

1. Follow the instructions presented in the problem for each tab in the worksheet. Complete each worksheet in precise order.
2. There are some pieces of information from the Estimated Balance Sheet that will be required for the solution for the project.
3. Complete the Cash Flow Budget and the two budgeted Financial Reports..

Check Numbers.

1. From the Production Budget September units to produce 22,800
2. From the Materials Budget total cost of materials for the quarter - $220,840
3. From the Cash Receipts Budget total cash receipt for the quarter - $1,031,900
4. From the Cash Budget ending Cash for September - $40,000

It will be very helpful and easy to understand if you follow just like attached screenshot.

Sales Budget

Production Budget

Direct Material Budget

Direct Labor Budget

Factory Overhead Budget

Chapter 22 Master Budgets and Planning The management of Nabar Manufacturing prepared the following estimated balance she e following estimated balance sheet for June 2019. plete Assets Cash .... ... Accounts receivable .... Raw materials inventory.. Finished goods inventory... Total current assets Equipment. Accumulated depreciation... Equipment, net.. NABAR MANUFACTURING Estimated Balance Sheet June 30, 2019 Liabilities and Equity $ 40,000 Accounts payable ...... . 249,900 Income taxes payable... 35,000 Short-term notes payable .. 241,080 Total current liabilities 565,980 Long-term nate payable 720,000 Total liabilities (240,000 Common stock .... 480,000 Retained earnings Total stockholders' equity $1,045,980 Total liabilities and equity $ 51.400 10,000 24,000 85,400 300,000 385 400 60,580 660,580 $1,045,980 Total assets To prepare a master budget for July, August, and September of 2019. management gathers the following information: a. Sales were 20,000 units in June. Forecasted sales in units are as follows: July 21,000; August, 19.000; September, 20,000; and October, 24,000. The product's selling price is $17 per unit and its total prod- uct cost is $14.35 per unit. b. Company policy calls for a given month's endine finished goods inventory to equal 70% of the next month's expected unit sales, The June 30 finished goods inventory is 16.800 units, which does not comply with the policy c. Company policy calls for a given month's ending raw materials inventory to equal 20% of the next month's materials requirements. The June 30 raw materials inventory is 4,375 units (which also fails to meet the policy). The budgeted September 30 raw materials inventory is 1,980 units. Raw materials cost $8 per unit. Each finished unit requires 0.50 units of raw materials. d. Each finished unit requires 0.50 hours of direct labor at a rate of $16 per hour. e. Overhead is allocated based on direct labor hours. The predetermined variable overhead rate is $2.70 per direct labor hour. Depreciation of $20,000 per month is treated as fixed factory overhead. f. Monthly general and administrative expenses include $9.000 administrative salaries and 0.9% monthly interest on the long-term note payable. g. Sales representatives' commissions are 10% of sales and are paid in the month of the sales. The sales manager's monthly salary is $3,500. h. The company expects 30% of sales to be for cash and the remaining 70% on credit. Receivables are collected in full in the month following the sale (none are collected in the month of the sale). 1. All raw materials purchases are on credit, and no payables arise from any other transactions. One month's raw materials purchases are fully paid in the next month. 1. Dividends of $20,000 are to be declared and paid in August k. Income taxes payable at June 30 will be paid in July. Income tax expense will be assessed at 35% in the quarter and paid in October I. Equipment purchases of $100,000 are budgeted for the last day of September m The minimum ending cash balance for all months is $40.000. If necessary, the company borrows enough cash using a short-term note to reach the minimum. Short-term notes require an interest nav- ment of 1% at each month-end (before any repayment). If the ending cash balance exceeds the mini mum, the excess will be applied to repaying the short-term notes payable balance. Required Prepare the following budgets and other financial information as required. All budgets and other financial information should be prepared for the third calendar quarter, except as otherwise noted below calculations to the nearest whole dollar. 1. Sales budget 7. General and administrative expense budget. 2. Production budget. 8. Cash budget 9. Budgeted income statement for the entire quarter (not for each 3. Raw materials budget. month separately). 4. Direct labor budget. 10. Budgeted balance sheet as of September 30, 2019. 5. Factory overhead budget. 6. Selling expense budget. C D 1 Chapter 22 Master Budget Sales Budget July August September Quarter Sales Budget Projected unit sales Selling price per unit Projected sales $0 $0 $0 $0 June Previous Month Actual unit sales Selling price per unit SO 14 E H I J K L M N O 16 D Master Budget F G Production Budget 1 Chapter 22 July August September Quarter 70.0% 70.0% 0 70.0% 0 Operating plan - ending inventory = 70% of next month's predicted sales Production Budget Next months' budgeted sales (units) from Sales Budget Ratio of inventory to future sales Budgeted ending inventory (units) Add: Budgeted sales (units) Required units of available production Deduct: Beginning inventory (units) Units to be produced 0 0 0 July August September Projected unit sales June ending inventory 1 Chapter 22 Master Budget Direct Materials Budget July August September Quarter 0.5 0 0.5 0 0 Direct Material Budget Budgeted Production units Materials requirements per unit Materials needed for production (pounds) Add: Budgeted ending inventory (pounds) Total materials requirements (pounds) Deduct: Beginning materials inventory Materials to be purchased (pounds) 0 0 0 000 Materials price per pound Total cost of direct materials purchases $8 $0 $8 $0 $8 $0 July August September Projected unit sales Ending materials inventory = 20% of next month's requirement June ending inventory Note: June materials purchases = $51,400 September ending inventory A | 1 Chapter 22 G Direct Labor Budget Master Budget July August September Quarter Direct Labor Budget Budgeted Production units Labor requirements per unit (hours) Total labor requirements per unit (hours) 0.5 0.5 Soon w = 0.5 0 Labor cost per hour Total cost of labor $16 $0 $16 $0 $16 $0 $0 1 Chapter 22 Master Budget Factory Overhead Budget July August September Quarter Factory Overhead Budget Budgeted Direct Labor Hours Variable factory OH rate Budgeted variable overhead Budgeted fixed overhead Budgeted total overhead $2.70 0 $2.70 0 $2.70 0 0 $0 $0 $0 $0 Overhead is allocated based on Direct Labor Hours The variable allocation rate is $2.70 per direct labor hour. The fixed overhead is $20,000 per month