I See The Light Projected Income Statement For the Period Ending December 31, 20x1 $ 1,125,000.00 750,000.00 $ 375,000.00 Sales 25,000 lamps @ $45.00 Cost of Goods Sold @ $30.00 Gross Profit Selling Expenses: Fixed Variable (Commission per unit) @ $3.00 Administrative Expenses: Fixed Variable @ $2.00 Total Selling and Administrative Expenses: Net Profit $ 23,000.00 75,000.00 $ 98,000.00 $ 42,000.00 50,000.00 92,000.00 190,000.00 185.000.00 I See The Light Projected Balance Sheet As of December 31, 20x1 34,710.00 67,500.00 Current Assets Cash Accounts Receivable Inventory Raw Material Lamp Kits Work in Process Finished Goods Total Current Assets 500 @ $16.00 0 3000 @ $30.00 8,000.00 90,000.00 200,210.00 $ Fixed Assets Equipment Accumulated Depreciation Total Fixed Assets Total Assets 20,000.00 6,800.00 13,200.00 213.410.00 54,000.00 54,000.00 Current Liabilities Accounts Payable Total Liabilities Stockholder's Equity Common Stock Retained Earnings Total Stockholder's Equity Total Liabilities and Stockholder's Equity $ 12,000.00 147,410.00 159,410.00 213.410.00 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: $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) Cost per lamp: $30.0000000 per lamp Expected increases for 20x2 When calculating projected increases round to TWO ($0.00) decimal places. 1. Material Costs are expected to increase by 5.50%. 2. Labor Costs are expected to increase by 3.50%. 3. Variable Overhead is expected to increase by 6.50%. 4. Fixed Overhead is expected to increase to $300,000. 5. Fixed Administrative expenses are expected to increase to $52,000. 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 $25,000 in 20x2. 8. Variable administrative expenses (measured a per lamp basis) are expected to increase by 6.00%. Variable Manufacturing Unit Cost 20x 1 Cost Projected Percent Increase 20x2 Cost Rounded to Decimal Places 16 5.5 Lamp Kit Labor $16.88 $2.07 2 3.5 {4.01} {4.02) {4.03} Variable Overhead 2 6.5 $2.13 Projected Variable Manufacturing Cost Per Unit $21.08 {4.04} Total Variable Cost Per Unit 20x1 Cost Projected Percent Increase 20x2 Cost Rounded to 2 Decimal Places 3 3.5 3.11 Variable Selling Variable Administrative Projected Variable Manufacturing Unit Cost 2 6 2.12 {4.05) {4.06) {4.04} 21.08 Projected Total Variable Cost Per Unit 26.31 {4.07} Schedule of Fixed Costs 20x 1 Cost 20x2 Cost Projected Percent Increase $ 300,000.00 {4.08} lamps @_) Fixed Overhead (normal capacity of Fixed Selling Fixed Administrative $ 25,000.00 {4.09) {4.10} $ 52,000.00 Projected Total Fixed Costs $ 377,000.00 {4.11} Complete the following budgets 1 Production Budget Planned Sales Desired Ending Inventory of Finished Goods Total Needed Less: Beginning Inventory 33000 2400 35400 3000 Total Production 32,400 units {7.01} 2 Materials Budget Lamp Kits Needed for Production Desired Ending Inventory Total Needed Less: Beginning Inventory Total Purchases Cost per piece Cost of Purchases (Round to two places, $##.##) 32,400 units 550 units 32,950 units 500 units 32,450 units 16.88 547,756.00 {8.01} {8.02} {8.03} {8.04} $ $ {8.05} {8.06} 3 Direct Labor Budget $ {8.07} Labor Cost Per Lamp Production Total Labor Cost (Round to two places, $##.##) 2.07 32,400 units 67,068.00 $ {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 2.1300000 32,400 units 69,012.00 300,000.00 $ $ {8.09} {8.10} Total Factory Overhead (Round to two places, $##.##) $ 369,012.00 {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, $##.##) {9.01) 5 Cost of making one unit next year Cost of one Lamp Kit Labor Cost Per Lamp Factory overhead per unit {9.02) {9.03) Total cost of one unit (Round to two places, $##.##) 6 Selling and Admin. Budget {9.04} Fixed Selling Variable Selling (Round to two places, $##.##) Fixed Administrative Variable Administrative (Round to two places, $##.##) Total Selling and Administrative (Round to two places, $##.##) {9.05) {9.06) Round dollars to two places, $##.## {9.07) VVOLVI 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 (9.08) Total Materials: Labor Overhead Cost of Goods Available Less: Ending Inventory, Finished Goods Cost of Goods Sold {9.09) {9.10) {9.11) {9.12) {9.13) (9.14} I See The Light Projected Income Statement For the Period Ending December 31, 20x1 $ 1,125,000.00 750,000.00 $ 375,000.00 Sales 25,000 lamps @ $45.00 Cost of Goods Sold @ $30.00 Gross Profit Selling Expenses: Fixed Variable (Commission per unit) @ $3.00 Administrative Expenses: Fixed Variable @ $2.00 Total Selling and Administrative Expenses: Net Profit $ 23,000.00 75,000.00 $ 98,000.00 $ 42,000.00 50,000.00 92,000.00 190,000.00 185.000.00 I See The Light Projected Balance Sheet As of December 31, 20x1 34,710.00 67,500.00 Current Assets Cash Accounts Receivable Inventory Raw Material Lamp Kits Work in Process Finished Goods Total Current Assets 500 @ $16.00 0 3000 @ $30.00 8,000.00 90,000.00 200,210.00 $ Fixed Assets Equipment Accumulated Depreciation Total Fixed Assets Total Assets 20,000.00 6,800.00 13,200.00 213.410.00 54,000.00 54,000.00 Current Liabilities Accounts Payable Total Liabilities Stockholder's Equity Common Stock Retained Earnings Total Stockholder's Equity Total Liabilities and Stockholder's Equity $ 12,000.00 147,410.00 159,410.00 213.410.00 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: $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) Cost per lamp: $30.0000000 per lamp Expected increases for 20x2 When calculating projected increases round to TWO ($0.00) decimal places. 1. Material Costs are expected to increase by 5.50%. 2. Labor Costs are expected to increase by 3.50%. 3. Variable Overhead is expected to increase by 6.50%. 4. Fixed Overhead is expected to increase to $300,000. 5. Fixed Administrative expenses are expected to increase to $52,000. 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 $25,000 in 20x2. 8. Variable administrative expenses (measured a per lamp basis) are expected to increase by 6.00%. Variable Manufacturing Unit Cost 20x 1 Cost Projected Percent Increase 20x2 Cost Rounded to Decimal Places 16 5.5 Lamp Kit Labor $16.88 $2.07 2 3.5 {4.01} {4.02) {4.03} Variable Overhead 2 6.5 $2.13 Projected Variable Manufacturing Cost Per Unit $21.08 {4.04} Total Variable Cost Per Unit 20x1 Cost Projected Percent Increase 20x2 Cost Rounded to 2 Decimal Places 3 3.5 3.11 Variable Selling Variable Administrative Projected Variable Manufacturing Unit Cost 2 6 2.12 {4.05) {4.06) {4.04} 21.08 Projected Total Variable Cost Per Unit 26.31 {4.07} Schedule of Fixed Costs 20x 1 Cost 20x2 Cost Projected Percent Increase $ 300,000.00 {4.08} lamps @_) Fixed Overhead (normal capacity of Fixed Selling Fixed Administrative $ 25,000.00 {4.09) {4.10} $ 52,000.00 Projected Total Fixed Costs $ 377,000.00 {4.11} Complete the following budgets 1 Production Budget Planned Sales Desired Ending Inventory of Finished Goods Total Needed Less: Beginning Inventory 33000 2400 35400 3000 Total Production 32,400 units {7.01} 2 Materials Budget Lamp Kits Needed for Production Desired Ending Inventory Total Needed Less: Beginning Inventory Total Purchases Cost per piece Cost of Purchases (Round to two places, $##.##) 32,400 units 550 units 32,950 units 500 units 32,450 units 16.88 547,756.00 {8.01} {8.02} {8.03} {8.04} $ $ {8.05} {8.06} 3 Direct Labor Budget $ {8.07} Labor Cost Per Lamp Production Total Labor Cost (Round to two places, $##.##) 2.07 32,400 units 67,068.00 $ {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 2.1300000 32,400 units 69,012.00 300,000.00 $ $ {8.09} {8.10} Total Factory Overhead (Round to two places, $##.##) $ 369,012.00 {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, $##.##) {9.01) 5 Cost of making one unit next year Cost of one Lamp Kit Labor Cost Per Lamp Factory overhead per unit {9.02) {9.03) Total cost of one unit (Round to two places, $##.##) 6 Selling and Admin. Budget {9.04} Fixed Selling Variable Selling (Round to two places, $##.##) Fixed Administrative Variable Administrative (Round to two places, $##.##) Total Selling and Administrative (Round to two places, $##.##) {9.05) {9.06) Round dollars to two places, $##.## {9.07) VVOLVI 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 (9.08) Total Materials: Labor Overhead Cost of Goods Available Less: Ending Inventory, Finished Goods Cost of Goods Sold {9.09) {9.10) {9.11) {9.12) {9.13) (9.14}