I See The Light Projected Income Statement For the Period Ending December 31, 20x1 Sales Cost of Goods Sold Gross Profit 25,000 lamps @ $45.00 @ $30.00 $ 1,125,000.00 750,000.00 $ 375,000.00 Selling Expenses: Fixed $ 23,000.00 Variable (Commission per unit) @ $3.00 75,000.00 $ 98,000.00 Administrative Expenses: Fixed Variable @ $2.00 $ 42,000.00 50,000.00 92,000.00 Total Selling and Administrative Expenses: Net Profit 190,000.00 $ 185,000.00 I See The Light Projected Balance Sheet As of December 31, 20x1 Current Assets Cash Accounts Receivable Inventory Raw Material Lamp Kits Work in Process Finished Goods Total Current Assets Fixed Assets Equipment Accumulated Depreciation Total Fixed Assets Total Assets 500 @ $16.00 0 3000 @ $30.00 Current Liabilities Accounts Payable Total Liabilities Stockholder's Equity Common Stock Retained Earings Total Stockholder's Equity Total Liabilities and Stockholder's Equity $ 34,710.00 67,500.00 8,000.00 90,000.00 $ 200,210.00 $ 20,000.00 6,800.00 $ $ 12,000.00 13,200.00 213,410.00 $ 54,000.00 $ 54,000.00 147,410.00 159,410.00 $ 213,410.00 The projected cost of a lamp is calculated based upon the projected increases or decreases to current costs. The present costs to manufacture one lamp are: Lamp Kit: Direct Labor: Variable Overhead: Fixed Overhead: Cost per lamp: Expected increases for 20x2 $16.0000000 per lamp 2.0000000 per lamp (4 lamps/hr.) 2.0000000 per lamp 10.0000000 per lamp (based on normal capacity of 25,000 lamps) $30.0000000 per lamp When calculating projected increases round to TWO ($0.00) decimal places. 1. Material Costs are expected to increase by 4.00%. 2. Labor Costs are expected to increase by 5.00%. 3. Variable Overhead is expected to increase by 4.50%. 4. Fixed Overhead is expected to increase to $275,000. 5. Fixed Administrative expenses are expected to increase to $60,000. 6. Variable selling expenses (measured on a per lamp basis) are expected to increase by 3.50%. 7. Fixed selling expenses are expected to be $29,000 in 20x2. 8. Variable administrative expenses (measured a per lamp basis) are expected to increase by 5.50%. On the following schedule develop the following figures: 1- 20x2 Projected Variable Manufacturing Unit Cost of a lamp. 2- 20x2 Projected Variable Unit Cost per lamp. 3- 20x2 Projected Fixed Costs. PART 3 Budgets Division N has decided to develop its budget based upon projected sales of 41,000 lamps at $49.00 per lamp. The company has requested that you prepare a master budget for the year. This budget is to be used for planning and control of operations and should be composed of: 1. Production Budget 2. Materials Budget 3. Direct Labor Budget 4. Factory Overhead Budget 5. Selling and Administrative Budget 6. Cost of Goods Sold Budget 7. Budgeted Income Statement 8. Cash Budget Notes for Budgeting: The company wants to maintain the same number of units in the beginning and ending inventories of work-in-process, and electrical parts while increasing the inventory of Lamp Kits to 600 pieces and decreasing the finished goods by 20%. Complete the following budgets 1 Production Budget Planned Sales Desired Ending Inventory of Finished Goods Total Needed Less: Beginning Inventory Total Production {7.01} 2 Materials Budget Lamp Kits Needed for Production {8.01} Desired Ending Inventory {8.02} Total Needed {8.03) Less: Beginning Inventory {8.04} Total Purchases Cost per piece {8.05} Cost of Purchases (Round to two places, $##.##) {8.06} 3 Direct Labor Budget Labor Cost Per Lamp Production Total Labor Cost (Round to two places, $##.##) {8.07) {8.08} 4 Factory Overhead Budget Variable Factory Overhead: Variable Factory Overhead Cost Per Unit Number of Units to be Produced Total Variable Factory Overhead (Round to two places, $##.##) Fixed Factory Overhead (8.09) {8.10} Total Factory Overhead (Round to two places, $##.##) (8.11) 4 Factory Overhead Budget Overhead Allocation rate based on: 1. Number of Units Total Factory Overhead / Number of Units (Round to two places, $##.####) 5 Cost of making one unit next year Cost of one Lamp Kit Labor Cost Per Lamp Factory overhead per unit Total cost of one unit (Round to two places, $##.###) 6 Selling and Admin. Budget Fixed Selling Variable Selling (Round to two places, $##.####) Fixed Administrative Variable Administrative (Round to two places, $####.####) Total Selling and Administrative (Round to two places, $####.####) COSI OL Goods Sold Budget - Beginning Inventory, Finished Goods Production Costs: Materials: Lamp Kits: Beginning Inventory Purchased Available for Use Ending Inventory of Lamp Kits Lamp Kits Used In Production Total Materials: Labor Overhead Cost of Goods Available Less: Ending Inventory, Finished Goods Cost of Goods Sold {9.01} {9.02} (9.03) {9.04} (9.05) {9.06} Round dollars to two places, $##.## {9.07} {9.08} {9.09} {9.10} {9.11} {9.12} (9.13) {9.14}