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Health & Wellness Consultants Health & Wellness Consultants produces and sells Sculp Max, a weight loss product for men and women. The company has been
Health & Wellness Consultants Health & Wellness Consultants produces and sells Sculp Max, a weight loss product for men and women. The company has been profitable for over five years. Its main customers are fitness enthusiasts and persons with noncommunicable diseases such as diabetes and hypertension. The company has a longterm plan that it breaks down into annual budgets.The company's projected cash balance is $ on January If the entity needs to borrow money, it should be repaid in four equal instalments on the last day of each quarter. The interest rate will be and interest payments will also be quarterly calculated using simple interestEach finished product requires b material. Other raw materials are insignificant in cost and are treated as indirect materials. The following projections for are made available: Sales for December are projected to be units. The marketing and sales manager anticipates that sales will increase by units each month, commencing in January and this trend is expected to continue for the next two years The companys sales policy indicates that of all sales are on credit, with the remainder in cash. The companys collection experience shows: collected in the month of sales collected in the month following sales collected two months following the salesThe remaining is deemed uncolectable The product sells for $ per unit, which is expected to remain constant until December Health and Wellness Consultants want to keep enough finished goods inventory on hand to meet of the next months sales. On December closing inventory stood at units.Regarding raw materials, the company has a policy to keep of all material inventory to meet the next months production needs. The closing inventory of raw materials for December was lbs All directmaterial purchases are made on credit, and of each months purchases are paid for during the month of purchase. The other will be paid next month Indirect materials are purchased with cash as needed. Workinprocess is insignificant. Projected manufacturing costs in are as follows: Direct material lbs per unit @ $ per pound Direct labour hrs per unit @ $ per hour Production overhead is $ per direct labour hour Total production cost per unit $ Budgeting Project Summer Page of The following information relates to manufacturing overheads: Manufacturing overhead is expected to be $ per month up to June Commencing July manufacturing overheads are expected to increase by forthe rest of the year Selling expenses are estimated using the highlow method based on monthly sales figures. You are provided with total selling expenses for the previous months as shown below:December November October September August units $ units $ units $ units $ units $ Administrative expenses are estimated using the least squares method based on direct labour hours. The administrative expenses include monthly depreciation charges of $ The following are past data on total administrative costs and the associated direct labour hours: PERIODDIRECT LABOUR HOURSTOTAL ADMINISTRATIVE COST$$$$$$$ Health and Wellness Consultants has the following expenditure planned during the year: March July September December Purchase of gym equipment Purchase of new computers Insurance payments Licensing & Permits$ $ $ $ Budgeting Project Summer Page of The Management Accountant at Health and Wellness Consultants is overwhelmed with costing new services and reached out the the School of Business Administration to provide a group of students to assist with the completion of the budget for the year Your group has been selected and are being asked to use the template provided to carry out the following tasks outlined below: Task Prepare the operating budgets for the year January December Sales Budget Production Budget Direct Materials Budget Direct Labour Budget Production Overhead Budget Selling Expenses Budget Provide workings for cost function used Administrative Expenses Budget Provide workings for cost function usedTask Prepare the Cash Budget and provide the supporting schedules for cash collected from customers and disbursements to suppliers Please create a cash flow budget from information given
Health & Wellness Consultants Health & Wellness Consultants produces and sells Sculp Max, a weight loss product for men and women. The company has been profitable for over five years. Its main customers are fitness enthusiasts and persons with noncommunicable diseases such as diabetes and hypertension. The company has a longterm plan that it breaks down into annual budgets.The company's projected cash balance is $ on January If the entity needs to borrow money, it should be repaid in four equal instalments on the last day of each quarter. The interest rate will be and interest payments will also be quarterly calculated using simple interestEach finished product requires b material. Other raw materials are insignificant in cost and are treated as indirect materials. The following projections for are made available: Sales for December are projected to be units. The marketing and sales manager anticipates that sales will increase by units each month, commencing in January and this trend is expected to continue for the next two years The companys sales policy indicates that of all sales are on credit, with the remainder in cash. The companys collection experience shows: collected in the month of sales collected in the month following sales collected two months following the salesThe remaining is deemed uncolectable The product sells for $ per unit, which is expected to remain constant until December Health and Wellness Consultants want to keep enough finished goods inventory on hand to meet of the next months sales. On December closing inventory stood at units.Regarding raw materials, the company has a policy to keep of all material inventory to meet the next months production needs. The closing inventory of raw materials for December was lbs All directmaterial purchases are made on credit, and of each months purchases are paid for during the month of purchase. The other will be paid next month Indirect materials are purchased with cash as needed. Workinprocess is insignificant. Projected manufacturing costs in are as follows: Direct material lbs per unit @ $ per pound Direct labour hrs per unit @ $ per hour Production overhead is $ per direct labour hour Total production cost per unit $ Budgeting Project Summer Page of The following information relates to manufacturing overheads: Manufacturing overhead is expected to be $ per month up to June Commencing July manufacturing overheads are expected to increase by forthe rest of the year Selling expenses are estimated using the highlow method based on monthly sales figures. You are provided with total selling expenses for the previous months as shown below:December November October September August units $ units $ units $ units $ units $ Administrative expenses are estimated using the least squares method based on direct labour hours. The administrative expenses include monthly depreciation charges of $ The following are past data on total administrative costs and the associated direct labour hours: PERIODDIRECT LABOUR HOURSTOTAL ADMINISTRATIVE COST$$$$$$$ Health and Wellness Consultants has the following expenditure planned during the year: March July September December Purchase of gym equipment Purchase of new computers Insurance payments Licensing & Permits$ $ $ $ Budgeting Project Summer Page of The Management Accountant at Health and Wellness Consultants is overwhelmed with costing new services and reached out the the School of Business Administration to provide a group of students to assist with the completion of the budget for the year Your group has been selected and are being asked to use the template provided to carry out the following tasks outlined below: Task Prepare the operating budgets for the year January December Sales Budget Production Budget Direct Materials Budget Direct Labour Budget Production Overhead Budget Selling Expenses Budget Provide workings for cost function used Administrative Expenses Budget Provide workings for cost function usedTask Prepare the Cash Budget and provide the supporting schedules for cash collected from customers and disbursements to suppliers Please create a cash flow budget from information given
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