need help with the cash collections and combined cash

Osborne Manufacturing is preparing its master budget for the first quarter of the upcoming year. The following data pertain to Osborne Manufacturing's operations: Current assets as of December 31 (prior year): Cash Accounts receivable net Inventory Property, plant, and equipment, net Accounts payable Capital stock Retained earnings $ 4,640 $ 57,600 $ 15,600 $ 141,500 $ 52,800 $ 124,500 $ 22,800 Actual sales in December were 72,000. Selling price per unit is projected to remain stable at $12 per unit throughout the budget period. Sales for the first five months of the upcoming year are budgeted to be as follows: January $ 104,400 February $ 126,000 March $ 122,600 April $ 119,500 May $ 135,400 b Sales are 20% cash and 80% credit. All credit sales are collected in the month following the sale. Osborne Manufacturing has a policy that states that each month's ending Sheet1 Cash Collections Productinn nira Sales are 20% cash and 80% credit. All credit sales are collected in the month following the sale. 23 b 24 25 26 C 27 28 29 30 d 31 Osborne Manufacturing has a policy that states that each month's ending inventory of finished goods should be 10% of the following month's sales (in units). 9 32 Of each month's direct material purchases, 20% are paid for in the month of purchase, while the remainder is paid for in the month following purchase. Two kilograms of direct material is needed per unit at $2.25 per kilogram. Ending inventory of direct materials should be 30% of next month's production needs. 33 34 35 36 e 37 Monthly manufacturing conversion costs are $4,500 for factory rent, $3,500 for other fixed manufacturing expenses, and $1.25 per unit for variable manufacturing overhead. No depreciation is included in these figures. All expenses are paid in the month in which they are incurred. 38 39 40 41 f 42 43 44 45 46 Computer equipment for the administrative offices will be purchased in the upcoming quarter. In January, Osborne Manufacturing will purchase equipment for $6,000 (cash), while February's cash expenditure will be $12,800, and March's cash expenditure will be $15,600. equipment for $6,000 (cash), while February's cash expenditure will be $12,800, and March's cash expenditure will be $15,600. 43 44 45 46 47 G 48 49 8 Operating expenses are budgeted to be $1.30 per unit sold plus fixed operating expenses of $2,500 per month. All operating expenses are paid in the month in which they are incurred. Ny Depreciation on the building and equipment for the general and administrative offices is budgeted to be $4,600 for the entire quarter, which includes depreciation on new acquisitions. 50 51 52 53 h 54 55 56 57 i 58 59 60 61 62 63 64 65 66 i 67 Osborne Manufacturing has a policy that the ending cash balance in each month must be at least $4,200. The company has a line of credit with a local bank. It can borrow in increments of $1,000 at the beginning of each month up to a total outstanding loan balance of $130,000. The interest rate on these loans is 2% per month simple interest (not compounded). Osborne Manufacturing pays down the line of credit balance if it has excess funds at the end of the quarter. The company also pays the accumulated interest at the end of the quarter on the funds borrowed during the quarter. 9 68 The company's income tax rate is projected to be 20% of operating income less interest expense. The company pays $10,800 cash at the end of February in estimated taxes. Sheet1 Cach 1 1 Prepare a schedule of cash collections for January, February, and March, and for the quarter in total 2 3 4 Cash Collections Budget January February March Quarter 6 Cash Sales 7 Credit Sales 8 Total cash collections 9 10 11 Quarter 11 7 Prepare a combined cash budget 2 Combined Cash Budget 4 January February March 5 Cash balance, beginning 6 Add cash collections 7 Total cash available 8 Less cash payments 9 Direct material purchases 110 Conversion costs 11 Operating expenses 12 Equipment purchases 13 Tax payment 14 Total disbursements 15 Ending cash balance before financing 16 Financing 17 Borrowings 18 Repayments 19 Interest payments 20 Total financing 21 Cash balance, ending 22 Quarter 8 E G 1 3. Perpare a direct materials budget 2 3 Direct Materials Budget 4 January February March 5 Units to be produced 6 x kg of DM needed per unit 7 Quantity (kg) needed for production 8 Plus: Desired ending inventory of DM 9 Total quantity (kg) needed 10 Less: Beginning inventory of DM 11 Quantity (kg) to purchase 12 x Cost per kg 13 Total cost of DM purchases 14 15 16 17 18 19 20 21 22 22 24 25 1 4 Prepare a cash payments budget for the direct material purchases from 2 Requirment 3 3 4 Cash Payments for Direct Material Purchases Budget 5 January February March Quarter 6 December purchases (from Accounts Payable 7 January purchases 8 February purchases 9 March purchases 10 Total cash payments for DM purchases 11 12 13 14 Cash Payments for Conversion Costs Budget Quarter D G H 1 S Perpare a cash payments budget for conversion costs. 2 3 Cash Payments for Conversion Costs Budget 4 January February March 5 Variable 6 Rent (fixed) 7 Other fixed MOH 8 Total payments for conversion costs 9 10 11 12 13 14 15 16 A 1 4 Quarter D G H 6 Prepare a cash payments budget for operating expenses 2 3 Cash Payments for Direct Material Purchases Budget January February March 5 Variable operating expenses 6 Fixed operating expenses 7 Total payments for operating expenses 8 9 10 11 12 K 1 H 8 Calculate the budgeted manufacturing cost per unit (assume that fixed manufacturing overhead is budgeted to be $0.80 per unit for the year) 2 3 4 Cash Payments for Conversion Costs Budget 5 6 Direct materials cost per unit 7 Conversin costs per unit 8 Fixed manufacturing overhead per unit 9 Budgeted cost of manufacturing each unit 10 11 12 13 T4 15 16 17 18 19 2016 21 Cash balance, ending 22 22 A 1 2 9 Prepare a budgeted income statement for the quarter ending March 31. (Hint: Cost of goods sold = Budgeted cost of manufacturing each unit/ Number of units sold) No coa 7 9 10 11 12 13 Budgeted Income Statement For the Quarter Ended March 31 Sales Cost of good sold Gross profit Operating expenses Depreciation expense Operating income Less interest expense Less provision for income taxes Net income 14 15 16 17 18 19 20 A B Balance Sheet As at March 31 Current Year Current assets Cash Accounts receivable, net Inventory Total current assets $ $ Non Current assets 0 Property, plant, and equipment, net 1 2 3. Current liabilities 14 Accounts payable 15 76 Equity 17 Capital stock 18 Retained earnings 19 Total Equity 20 21 Total Debt and Equity 22 23 24 $ $