o 1 A B D E F G H J K L M N Q R Name: 2 3 Iguana, Inc., manufactures bamboo picture frames that sell for $25 each. Each frame requires 4 linear feet of bamboo, which costs $2.00 per foot. 4 Each frame takes approximately 30 minutes to build, and the labor rate averages $11 per hour. Iguana has the following inventory policies: 5 Ending finished goods inventory should be 40 percent of next month's sales. 6 Ending direct materials inventory should be 30 percent of next month's production. 7 8 Expected unit sales (frames) for the upcoming months follow: 9 March 290 10 April 280 11 May 330 12 June 430 13 July 405 14 August 455 15 16 Variable manufacturing overhead is incurred at a rate of $0.60 per unit produced. Annual fixed manufacturing overhead is estimated to be $7,200 ($600 per month) 17 for expected production of 3,000 units for the year. Selling and administrative expenses are estimated at $700 per month plus $0.50 per unit sold. 18 Iguana, Inc., had $11,100 cash on hand on April 1. Of its sales, 80 percent is in cash. Of the credit sales, 50 percent is collected during the month of the sale, and 50 percent 19 is collected during the month following the sale. 20 Of direct materials purchases, 80 percent is paid for during the month purchased and 20 percent is paid in the following month. Direct materials purchases for March 1 totaled $2,000. All other 21 operating costs are paid during the month incurred. Monthly fixed manufacturing overhead includes $180 in depreciation. During April, Iguana plans to pay $3,300 for a piece of equipment. 1 1. Compute the budgeted cash receipts for Iguana. 5 points 2 April May June 2nd Quarter Total 3 Budgeted Cash Receipts 4 5 2. Compute the budgeted cash payments for Iguana. 5 points 6 April May June 2nd Quarter Total 7 Cash Payments 8 9 3. Prepare the cash budget for Iguana. Assume the company can borrow in increments of $1,000 to maintain a $10,000 minimum cash balance 10 April May June 2nd Quarter Total 11 Beginning Cash Balance 12 Plus: Budgeted Cash Receipts 13 Less: Budgeted Cash Payments 14 Preliminary Cash Balance 15 Cash Borrowed / Repaid 16 Ending Cash Balance 17