I need help with Assessment 8! There are two parts to this question. I would be greatly appreciative if you could help me out with them. Thank you in advance!

BUS-FP4061 - Managerial Accounting Principles Assessment 8: Master Budget and Flexible Budget Preparation Worksheet Part A Solve the given problem based on the following scenario. The managers of Megacorp need you to create the master budget for the months of January, February, and Ma Megacorp Estimated Balance Sheet (as of December 31, 2013) Assets ($) Cash Accounts receivable Inventory Total current assets Equipment Less accumulated depreciation Net equipment 405,000 (50,625) Total assets Liabilities and Equity ($) Accounts payable Bank loan payable Taxes payable (due 3/15/2014) Total liabilities Common stock Retained earnings Total stockholders' equity 354,375 184,500 Total liabilities and equity Use the following data to prepare the master budget. A single product of Megacorp can be purchased for $25 per unit and resold for $50 per unit. The anticipated inventory level on December 31, 2013, is 2,500 units. This is actually more than its desired level for 2014, which is 20% of January's projected sales (in units). Projected sales are: 5,250 units for January 6,750 units for February 8,250 units for March 7,500 units for April The total sales consists of 25% cash sales and 75% credit sales. 60% of credit sales is collected in the first month after the sale, and 40% is collected in the second month after the sale. $93,750 of the accounts receivable balance for December 31, 2013, is collected in January and $300,000 is collected in February. 20% of the payment for merchandise purchases is made one month after the purchase, and 80% is made in the second month. $60,000 of the balance of accounts payable for December 31, 2013, is paid in January, and $210,000 is paid in February. Salaries for salespersons average $45,000 per year. In addition to this, a sales commission equal to 20% of each salesperson's sales is paid on a monthly basis. Salaries for general administrative staff average $108,000 per year. Each month, $1,500 is paid for maintainance expenses. The December 2013 balance sheet reflects an equipment purchase in January 2013. Using the straight-line method, depreciation will occur over 8 years, with no salvage value. A full month's depreciation is recognized in the month in which the asset is purchased. The following new equipment purchases are projected for the next quarter: in January $27,000 in February $72,000 in March $21,600 The company has negotiated to purchase land for $112,500, which will be paid on the last day of March, in cash. Megacorp has arranged an agreement with its bank to take additional loans as needed. The bank charges 12% interest per year. Megacorp pays interest on the monthly beginning balance at the end of each month. The company may make full or partial loan payments on the last day of the month. According to this agreement with the bank, the minimum ending cash balance each month must be $18,750. The first quarter's income tax is paid on April 15 at a tax rate of 35%. Using the data provided, prepare the master budget for the first quarter of 2014, including all the following budgets: 1. Monthly sales budgets (showing both budgeted unit sales and dollar sales) 2. Monthly merchandise purchases budgets 3. Monthly selling expense budgets 4. Monthly general and administrative expense budgets 5. Monthly capital expenditures budgets 6. Monthly cash budgets 7. Budgeted income statement for the entire first quarter (not for each month) 8. Budgeted balance sheet as of March 31, 2014 Note: Round numbers to the nearest dollar and use supporting calculations. Megacorp Sales Budgets January, February, and March 2014 Budgeted Units Budgeted Unit Price Budgeted Total Dollars Megacorp Merchandise Purchases Budgets January, February, and March 2014 January ### February March Megacorp Selling Expenses Budget January, February, and March 2014 January February March Megacorp General and Administrative Expenses Budget January, February, and March 2014 January February March * Depreciation expense calculations Annual Depreciation Expense January February Megacorp Capital Expenditures Budget January, February, and March 2014 January February Megacorp Cash Budgets January, February, and March 2014 January February Supporting calculations January February March March March March Total Note A: Cash receipts from customers Note B: Cash payments for merchandise Megacorp Budgeted Income Statement For Three Months Ended March 2014 Megacorp Budgeted Balance Sheet March 31, 2014 Input values uary, February, and March of 2014. Megacorp Balance sheet date Ending date of first quarter 12/31/2013 3/31/2014 Master budget for January February Megacorp Estimated Balance Sheet (as of D Assets ($) 13) $50 per unit. Company name 27,000 393,750 112,500 533,250 Cash Accounts receivable Inventory Total current assets Equipment Less accumulated depreciation Net equipment 354,375 887,625 270,000 11,250 67,500 348,750 538,875 887,625 Liabilities and Equity ($) Accounts payable Bank loan payable Taxes payable (due 3/15/2014) Total liabilities Common stock Retained earnings Total stockholders' equity Total liabilities and equity Unit purchase price Unit sale price Anticipated inventory on December 31, 2013 Ratio of inventory to future sales January projected sales February projected sales March projected sales April projected sales Cash sales (percentage of total sales) Credit sales (percentage of total sales) % of credit sales collected in the first month after sales % of credit sales collected in the second month after sales Accounts receivable for December 31, 2013 - collected in Jan Accounts receivable for December 31, 2013 - collected in Feb % of purchases paid for one month after the purchase % of purchases paid for two months after the purchase Accounts payable for December 31, 2013 - paid in January Accounts payable for December 31, 2013 - paid in February Average salary of salespersons Sales commission as a percentage of each salesperson's sale General administrative staff annual salaries Monthly maintenance expenses Month of equipment purchase January equipment purchases February equipment purchases March equipment purchases Purchase price of land Yearly bank interest Minimum monthly ending cash balance Date of payment of first quarter's income tax Tax rate Years over which depreciation occurs Period for which master budget is prepared Total ### Total Total Total Total ### 12/31/2013 March April ated Balance Sheet (as of December 31, 2013) Assets ($) 27,000 393,750 112,500 533,250 405,000 (50,625) 354,375 887,625 Total assets Liabilities and Equity ($) 270,000 11,250 67,500 348,750 354,375 184,500 538,875 887,625 Total liabilities and equity rst month after sales econd month after sales 31, 2013 - collected in January 31, 2013 - collected in February h after the purchase 1 $25 $50 2500 20% 5250 6750 8250 7500 25% 75% 60% 40% $93,750 $300,000 20% 100% 1 units of next month's desired sales units units units units 1 1 hs after the purchase 1, 2013 - paid in January 1, 2013 - paid in February e of each salesperson's sales 80% $60,000 1 $210,000 $45,000 20% $108,000 $1,500 January 2013 $27,000 $72,000 $21,600 $112,500 12% $18,750 15-Apr 35% 8 January, February, and March 2014 Part B Solve problems 1-5 based on the following scenario. Conglomco Company has asked you to develop a flexible overhead budget, based on the data below. Standard Costs for Product per Unit Direct materials (6 pounds, at $5 per pound) Direct labor (2 hours, at $17 per hour) Overhead (2 hours, at $13.875 per hour) Total standard cost $ $ $ $ 30.00 34.00 27.75 91.75 The predetermined overhead rate ($13.875 per direct labor hour) is based on an expected volume of 75% of th 20,000 units per month. Budgeted Overhead Costs per Month (at 75% capacity) Variable Costs Amount ($) Indirect materials 33,750 Indirect labor 135,000 Power 33,750 Repairs and maintenance 67,500 Total variable overhead costs 270,000 Fixed Overhead Costs DepreciationBuilding DepreciationMachinery Taxes and insurance Supervision Total fixed overhead costs Total overhead costs 18,000 60,000 9,000 59,250 146,250 416,250 The company incurred the following actual costs when it operated at 75% of capacity in September. Expenses Direct materials (91,000 pounds, at $5.10 per pound) Direct labor (30,500 hours, at $17.25 per hour) Overhead costs Indirect materials Indirect labor Power Repairs and maintenance DepreciationBuilding DepreciationMachinery Taxes and insurance Supervision Amount ($) 464,100 526,125 33,187 133,312 32,250 72,000 18,000 56,250 8,625 67,750 Total overhead costs Total costs 421,374 1,411,599 Complete the problems below. Add your answers in this template and show your work. Problem 1. Examine the monthly overhead budget to: Determine the costs per unit for each variable overhead item and each item's total per-unit costs. Identify the total fixed costs per month. Problem 2. Prepare flexible overhead budgets for September, showing the amounts of each variable and fixed 65%, 75%, and 85% capacity levels. Problem 3. Include the price and quantity variances to compute the direct materials cost variance. Problem 4. Include the rate and efficiency variances to compute the direct labor cost variance. Problem 5. Prepare the overhead variance report, showing the overhead variances for individual items. Input values Company name Month he data below. ted volume of 75% of the factory's capacity of Price per pound Direct material per unit (pounds) Rate per direct labor hour Direct labor hours per unit Overhead rate per hour Total materials for actual production (pounds) Total labor hours for actual production Budgeted Overhead Costs per M Variable Costs Indirect materials Indirect labor Power Repairs and maintenance Total variable overhead costs Fixed Overhead Costs DepreciationBuilding DepreciationMachinery Taxes and insurance Supervision Total fixed overhead costs Total overhead costs September. Expenses Direct materials (91,000 pounds, at $5.10 per Direct labor (30,500 hours, at $17.25 per hour Overhead costs Total costs m's total per-unit costs. f each variable and fixed cost at the st variance. individual items. Full capacity Capacity on which overheads are based Levels Number of units Conglomco Company September rial per unit (pounds) ect labor hour hours per unit ate per hour als for actual production (pounds) hours for actual production Standard $5.00 6 $17.00 2 $ 13.875 90,000 30,000 Actual $5.10 $17.25 91,000 30,500 Budgeted Overhead Costs per Month (at 75% capacity) Variable Costs Amount ($) 33,750 135,000 33,750 d maintenance 67,500 le overhead costs 270,000 Fixed Overhead Costs nBuilding nMachinery overhead costs Expenses rials (91,000 pounds, at $5.10 per pound) (30,500 hours, at $17.25 per hour) Indirect materials Indirect labor Power Repairs and maintenance DepreciationBuilding DepreciationMachinery Taxes and insurance Supervision Amount ($) 18,000 60,000 9,000 59,250 146,250 416,250 Amount ($) 464,100 526,125 33,187 133,312 32,250 72,000 18,000 56,250 8,625 67,750 13.8750 Total overhead costs 421,374 1,411,599 which overheads are based 65% 13,000 75% 15,000 20,000 units per month 75% of full capacity 85% 17,000 30000 416100