I need help with the cash budget, can you be very clear when doing it please. more information is below
Three-Month Master Budget Williams Company Balance Sheet December 31 Cash Accounts receivable Raw materials Finished goods Land Plant and equipment Less: accumulated depreciation Total assests $41,700 192,000 102,240 64,400 50,000 Cash Budget Williams Company First Quarter $500,000 112,000 388,000 $838,340 January February March ebruary $40,000 $ Accounts payable to suppliers Common Stock Retained Earnings Total liabilities and equity $100,000 698,340 798,340 $838,340 Beginning cash balance Add: Receipts Cash sales to customers Cash collected from accounts receivable Tatal available cash Less: Disursements Raw materials cash purchases Raw materials accounts payable purchases Direct labor Factory owerhead Selling and administrative expense Income tax expense Total disbursements Excess (deficiency of available cash over cash disbursements PVC SALES Budgeted PVC Sales units) January February March April May Units 7,000 8,000 10,000 8,000 7,000 PVC Selling Price $60.00 % Sales Collected Month Sold 40% % Sales Collected Next Month 60% $ $ - $ -$ $ FINISHED GOODS INVENTORY: PVC Beginning Inventory Ending Inventory of Next Month's Sales 1,400 20% RAW PVC PRODUCTION OF PVC ONE UNIT OF PVC PRODUCED USING PRICES OF RAW MATERIALS AND LABOR RESIN DIRECT LABOR HOURS 5 3 0.5 $4.00 $ $2.80 $ $24 RAW MATERIALS Beginning Inventory Levels Ending Inventory % of Next Month's Production Needs % Purchases Paid in Month of Purchase % Purchases Paid in Month After Purchase 18,000 25.00% 70.00% 30.00% 10,800 25.00% 70.00% 30.00% 100.00% 0.00% FACTORY OVERHEAD Applied Per Direct Labor Hour $12.00 SELLING AND ADMINISTRATION Total $10,000.00 per month plus 10.00% of sales PLANT AND EQUIPMENT Depredates Evenly Induded in Factory Overhead at $12000 per year Monthly Depreciation $1,000 Sales Budget Williams Company First Quarter Expected unit sales Unit selling price Total sales January February March Quarter 1 7,000 8,000 10,000 25,000 $60 $60 $60 $60 $420,000 $480,000 $600,000 $1,500,000 Production Budget in Units Williams Company First Quarter Expected unit sales Add: Desired ending finished goods units Total required units Less: Beginning finished goods units Required production units January February March Quarter 1 April May 7,000 8,000 10,000 25,000 8,000 7,000 1600 2000 1600 1400 8,600 10,000 11,600 9,400 1,400 1600 2000 1600 7,200 8,400 9,600 7,800 Notes Desired ending inventory is currently of next month's expected sales 20% Raw Materials Budget Williams Company First Quarter January February March Quarter 1 7,200 8,400 9,600 25,200 April 7,800 5 39,000 Units to be produced RAW PVC RAW PVC per unit Units of RAW PVC needed for production Add: Desired ending RAW PVC inventory Total RAW PVC units required Less: Beginning RAW PVC inventory RAW PVC materials purchase Cost per unit of RAW PVC Total cost of RAW PVC purchases 5 5 5 5 36,000 42,000 48,000 126,000 10500 12,000 9,750 9,750 46,500 54,000 57,750 135,750 -18,000 - 10,500 -12,000 -18,000 28,500 43,500 45,750 117,750 $4 $4 $4 $ 4.00 $114,000 $174,000 $183,000 $471,000 25% Note: Desired ending inventory of RAW PVC of next month's production needs January February March Quarter 1 7,200 8,400 9,600 25,200 April 7,800 3 3 3 23,400 Units to be produced RESIN RESIN per unit Units of RESIN needed for production Add: Desired ending RESIN inventory TotalRESIN units required Less: Beginning RESIN inventory RESIN materials purchase Cost per unit of RESIN Total cost of RESIN purchases 3 21,600 6,300 27,900 -10,800 17,100 $2.80 $47,880 3 25,200 7,200 32,400 -6,300 26,100 $2.80 $73,080 28,800 75,600 5,850 5,850 34,650 81,450 -7,200 -10,800 27,450 70,650 $2.80 $ 2.80 $76,860 $197,820 25% Note: Desired ending inventory of RESIN of next month's production needs Direct Labor Budget Williams Company First Quarter Units to be produced Direct labor time (hours) per unit Total required direct labor hours Direct labor costs per hour Total direct labor costs January February March Quarter 1 7,200 8,400 9,600 25,200 0.5 0.5 0.5 0.5 3600 4200 4800 12600 $24 $24 $24 $ 24.00 $86,400 $100,800 $115,200 $302,400 Overhead Budget Williams Company First Quarter Direct labor hours Applied factory overhead rate Factory overhead Less: included plant and equipment depreciation Total factory overhead January February March Quarter 1 3600 4200 4800 12600 $12 $12 $12 12 43,200 50,400 57,600 151,200 1000 1000 1000 3000 $42,200 $49,400 $56,600 $148,200
