Payne Company's management asks you to prepare its master budget using the following information. The budget is to cover the months of April, May, and June of 2017. PAYNE COMPANY Balance Sheet March 31, 2017 Liabilities and Equity Assets $ 63,818 $50,000 Accounts payable Short-term notes payable Cash 12.000 175.000 Accounts receivable $ 75,818 30,798 Total current liabilities Raw materials inventory 200.000 96.600 Long-term note payable Finished goods inventory 275,818 $352,398 Total liabilities Total current assets 435,000 Common stock 480,000 Equipment 31.580 Retained earnings (90.000) Less: Accumulated depreciation 466.580 390.000 Total stockholders' equity Equipment, net $742.398 $742.398 Total Iiabilities and equity Total assets 2.425 pounds 0$12.70, rounded to nearest whole doller8,400 units $11.50 per unit Additional Information a. Sales for March total 10,000 units. Expected sales (in units) are: 10,500 (April), 9.500 (May). 10.000 (June), and 10,500 (July). The product's selling price Page 903 $25 per unit. b. Company policy calls for a given month's ending finished goods inventory to equal 80% of the next month's expected unit sales. The March 31 finished g0ods inventory is 8,400 units, which complies with the policy. The product's manufacturing cost is $11.50 per unit, including per unit costs of $6.35 for materials (0.5 Ibs. at $12.70 per lb.), $3.75 for direct labor (0.25 hour x $15 direct labor rate per hour), S0.90 for variable overhead, and $0.50 for fixed overhead. Fixed overhead consists entirely of $5.000 of monthly depreciation expense. Company policy also calls for a given month's ending raw materials inventory to equal 50 % of next month's expected materials needed for production The March 31 inventory is 2,425 units of materials, which comphes with the policy. The company expects to have 2.100 units of materials inventory on June 30. M MHE Reader SAM-Project Assignment Subm + x 062F6 % 2F964 % 5Bdata-uuid-62134e64abce4e2b9061f591c36882b7 %65DI % 2F4 % 2F 4 % 5Bdata-uuid-55cbalb70b944feaa42b47566c189604 %5D % 2F8 % 5Bdata Less: Accumulated depreciation (90.000) Retained earnings 31.580 Equipment, net 390.000 Total stockholders' equity 466.580 Total assets $742,398 Total liabilities and equity $742.398 2.425 pounds 0512 70, rounded to nearest whole doller8,400 units 0 $11.50 per unit Additional Information a. Sales for March total 10,000 units. Expected sales (in units) are: 10.500 (April), 9.500 (May), 10.000 (June), and 10,500 (July). The product's selling price is $25 per unit. Page 903 b. Company policy calls for a given month's ending finished goods inventory to equal 80% of the next month's expected unit sales. The March 31 finished goods inventory is 8,400 units, which complies with the policy. The product's manufacturing cost is $11.50 per unit, including per unit costs of $6.35 for materials (0.5 lbs. at $12.70 per lb.). $3.75 for direct labor (0.25 hour x $15 direct labor rate per hour), $0.90 for variable overhead, and $0.50 for fixed overhead. Fixed overhead consists entirely of $5,000 of monthly depreciation expense. Company policy also calls for a given month's ending raw materials inventory to equal 50 % of next month's expected materials needed for production. The March 31 inventory is 2.425 units of materials, which complies with the policy. The company expects to have 2,100 units of materials inventory on June 30. c. Sales representatives' commissions are 12% of sales and are paid in the month of the sales. The sales manager's monthly salary will be $3.500 in April and $4,000 per month thereafter. d. Monthly general and administrative expenses include $8,000 administrative salaries and 0.9 % monthly interest on the long-term note payable. e. The company expects 30% of sales to be for cash and the remaining 70 % on credit. Receivables are collected in full in the month following the sale (none is collected in the month of the sale). f. All direct materials purchases are on credit, and no payables arise from any other transactions. One month's purchases are fully paid in the next month. Materials cost $12.70 per pound g. The minimum ending cash balance for all months is $50,000. If necessary, the company borrows enough cash using a short-term note to reach the minimum. Short-term notes require an interest payment of 1% at each month end (before any repayment). If the ending cash balance exceeds the minimum, the excess will be applied to repaying the short-term notes payable balance. h. DIvidends of $100,000 are to be declared and paid in May G No.cath.naoants for inema tavac a to ha.amada.dusna tha sannnd.calendar.aurtar Innama tavae wll ha aeenccad st instructions NP dock Payne Company's management asks you to prepare its master budget using the following information. The budget is to cover the months of April, May, and June of 2017. PAYNE COMPANY Balance Sheet March 31, 2017 Liabilities and Equity Assets $ 63,818 $50,000 Accounts payable Short-term notes payable Cash 12.000 175.000 Accounts receivable $ 75,818 30,798 Total current liabilities Raw materials inventory 200.000 96.600 Long-term note payable Finished goods inventory 275,818 $352,398 Total liabilities Total current assets 435,000 Common stock 480,000 Equipment 31.580 Retained earnings (90.000) Less: Accumulated depreciation 466.580 390.000 Total stockholders' equity Equipment, net $742.398 $742.398 Total Iiabilities and equity Total assets 2.425 pounds 0$12.70, rounded to nearest whole doller8,400 units $11.50 per unit Additional Information a. Sales for March total 10,000 units. Expected sales (in units) are: 10,500 (April), 9.500 (May). 10.000 (June), and 10,500 (July). The product's selling price Page 903 $25 per unit. b. Company policy calls for a given month's ending finished goods inventory to equal 80% of the next month's expected unit sales. The March 31 finished g0ods inventory is 8,400 units, which complies with the policy. The product's manufacturing cost is $11.50 per unit, including per unit costs of $6.35 for materials (0.5 Ibs. at $12.70 per lb.), $3.75 for direct labor (0.25 hour x $15 direct labor rate per hour), S0.90 for variable overhead, and $0.50 for fixed overhead. Fixed overhead consists entirely of $5.000 of monthly depreciation expense. Company policy also calls for a given month's ending raw materials inventory to equal 50 % of next month's expected materials needed for production The March 31 inventory is 2,425 units of materials, which comphes with the policy. The company expects to have 2.100 units of materials inventory on June 30. M MHE Reader SAM-Project Assignment Subm + x 062F6 % 2F964 % 5Bdata-uuid-62134e64abce4e2b9061f591c36882b7 %65DI % 2F4 % 2F 4 % 5Bdata-uuid-55cbalb70b944feaa42b47566c189604 %5D % 2F8 % 5Bdata Less: Accumulated depreciation (90.000) Retained earnings 31.580 Equipment, net 390.000 Total stockholders' equity 466.580 Total assets $742,398 Total liabilities and equity $742.398 2.425 pounds 0512 70, rounded to nearest whole doller8,400 units 0 $11.50 per unit Additional Information a. Sales for March total 10,000 units. Expected sales (in units) are: 10.500 (April), 9.500 (May), 10.000 (June), and 10,500 (July). The product's selling price is $25 per unit. Page 903 b. Company policy calls for a given month's ending finished goods inventory to equal 80% of the next month's expected unit sales. The March 31 finished goods inventory is 8,400 units, which complies with the policy. The product's manufacturing cost is $11.50 per unit, including per unit costs of $6.35 for materials (0.5 lbs. at $12.70 per lb.). $3.75 for direct labor (0.25 hour x $15 direct labor rate per hour), $0.90 for variable overhead, and $0.50 for fixed overhead. Fixed overhead consists entirely of $5,000 of monthly depreciation expense. Company policy also calls for a given month's ending raw materials inventory to equal 50 % of next month's expected materials needed for production. The March 31 inventory is 2.425 units of materials, which complies with the policy. The company expects to have 2,100 units of materials inventory on June 30. c. Sales representatives' commissions are 12% of sales and are paid in the month of the sales. The sales manager's monthly salary will be $3.500 in April and $4,000 per month thereafter. d. Monthly general and administrative expenses include $8,000 administrative salaries and 0.9 % monthly interest on the long-term note payable. e. The company expects 30% of sales to be for cash and the remaining 70 % on credit. Receivables are collected in full in the month following the sale (none is collected in the month of the sale). f. All direct materials purchases are on credit, and no payables arise from any other transactions. One month's purchases are fully paid in the next month. Materials cost $12.70 per pound g. The minimum ending cash balance for all months is $50,000. If necessary, the company borrows enough cash using a short-term note to reach the minimum. Short-term notes require an interest payment of 1% at each month end (before any repayment). If the ending cash balance exceeds the minimum, the excess will be applied to repaying the short-term notes payable balance. h. DIvidends of $100,000 are to be declared and paid in May G No.cath.naoants for inema tavac a to ha.amada.dusna tha sannnd.calendar.aurtar Innama tavae wll ha aeenccad st instructions NP dock