Master Budgeting

A mattress company raises the prices of their mattresses, will this increase or decrease the budget?

what if the Mattress company reduces product returns, will this increase or decrease the budget?

What if they optimize supply chain efficiencies, assuming this means material cost. Will this increase or decrease the budget?

If they drive market efficiencies will this increase or decrease the budget?

The mattress company reduces fixed costs while increasing variable costs in production. How will it affect these three production budgets?

direct material- increase or decrease

direct Labor- increase or decrease

direct overhead- increase or decrease

Hampton Freeze, Inc. Budgeting Assumptions For the Year Ended December 31, 2021 All 4 Quarters Quarter 2 3 30,000 40,000 10,000 4 20,000 $ 20.00 70% 30% 20% 5 6 Sales Budget 7 Budgeted sales in cases 8 Selling price per case 9 Percentage of sales collected in the quarter of sale 10 Percentage of sales collected in the quarter after sale 11 12 Production Budget 13 Percentage of next quarter's sales in ending finished goods inventory 14 15 Direct Materials Budget 16 Pounds of sugar per case 17 Cost per pound of sugar 18 Percentage of next quarter's production needs in ending inventory 19 Percentage of purchases paid in the quarter purchased 20 Percentage of purchases paid in the quarter after purchase 21 22 Direct Labor Budget 23 Direct labor-hours required per case 24 Direct labor cost per hour 25 26 Manufacturing Overhead Budget 27 Variable manufacturing overhead per direct labor-hour 28 Fixed manufacturing overhead per quarter 29 Depreciation per quarter $ 15 0.20 10% 50% 50% 0.40 $ 15.00 $ 4.00 $ 60,600 $ 15,000 30 JU 11 20% 14 $ 15 0.20 10% 50% 50% 21 0.40 $ 15.00 Percentage or sales collected in the quarter after sale 12 Production Budget 13 Percentage of next quarter's sales in ending finished goods inventory 15 Direct Materials Budget 18 Pounds of sugar per case 17 Cost per pound of sugar 18 Percentage of next quarter's production needs in ending inventory 19 Percentage of purchases paid in the quarter purchased 20 Percentage of purchases paid in the quarter after purchase 22 Direct Labor Budget 23 Direct labor-hours required per case 24 Direct labor cost per hour 25 28 Manufacturing Overhead Budget 27 Variable manufacturing overhead per direct labor-hour 28 Fixed manufacturing overhead per quarter 29 Depreciation per quarter 30 31 32 Selling and Administrative Expense Budget 33 Variable selling and administrative expense per case 34 Fixed selling and administrative expense per quarter: 35 Advertising 36 Executive salaries 37 Insurance 38 Property tax 39 Depreciation 40 41 Cash Budget 42 Minimum cash balance 43 Equipment purchases $ 4.00 $ 60,600 $ 15,000 $ 1.80 $ 20,000 $ 55,000 $ 10,000 $ 4,000 $ 10,000 $ 30,000 $ 50,000 $ 40,000 $20,000 $ 20,000 Hampton Freeze, Inc. Budgeting Assumptions For the Year Ended December 31, 2021 All 4 Quarters Quarter 2 3 30,000 40,000 10,000 4 20,000 $ 20.00 70% 30% 20% 5 6 Sales Budget 7 Budgeted sales in cases 8 Selling price per case 9 Percentage of sales collected in the quarter of sale 10 Percentage of sales collected in the quarter after sale 11 12 Production Budget 13 Percentage of next quarter's sales in ending finished goods inventory 14 15 Direct Materials Budget 16 Pounds of sugar per case 17 Cost per pound of sugar 18 Percentage of next quarter's production needs in ending inventory 19 Percentage of purchases paid in the quarter purchased 20 Percentage of purchases paid in the quarter after purchase 21 22 Direct Labor Budget 23 Direct labor-hours required per case 24 Direct labor cost per hour 25 26 Manufacturing Overhead Budget 27 Variable manufacturing overhead per direct labor-hour 28 Fixed manufacturing overhead per quarter 29 Depreciation per quarter $ 15 0.20 10% 50% 50% 0.40 $ 15.00 $ 4.00 $ 60,600 $ 15,000 30 JU 11 20% 14 $ 15 0.20 10% 50% 50% 21 0.40 $ 15.00 Percentage or sales collected in the quarter after sale 12 Production Budget 13 Percentage of next quarter's sales in ending finished goods inventory 15 Direct Materials Budget 18 Pounds of sugar per case 17 Cost per pound of sugar 18 Percentage of next quarter's production needs in ending inventory 19 Percentage of purchases paid in the quarter purchased 20 Percentage of purchases paid in the quarter after purchase 22 Direct Labor Budget 23 Direct labor-hours required per case 24 Direct labor cost per hour 25 28 Manufacturing Overhead Budget 27 Variable manufacturing overhead per direct labor-hour 28 Fixed manufacturing overhead per quarter 29 Depreciation per quarter 30 31 32 Selling and Administrative Expense Budget 33 Variable selling and administrative expense per case 34 Fixed selling and administrative expense per quarter: 35 Advertising 36 Executive salaries 37 Insurance 38 Property tax 39 Depreciation 40 41 Cash Budget 42 Minimum cash balance 43 Equipment purchases $ 4.00 $ 60,600 $ 15,000 $ 1.80 $ 20,000 $ 55,000 $ 10,000 $ 4,000 $ 10,000 $ 30,000 $ 50,000 $ 40,000 $20,000 $ 20,000