plans to produce 8,000 units in June, what are budgeted sales for July?
1. Topaz Company has the following expected pattern of collections on credit sales: 70 percent collected in the month of sale, 15 percent in the month after the month of sale, and 14 percent in the second month after the month of sale. The remaining 1 percent is never collected. At the end of May, Topaz Company has the following accounts receivable balances: From April sales From May sales $21,000 48,000 Topaz's expected sales for June are $150,000. What were total sales for April? a. $150,000 b. $72,414 c. $70,000 d. $140,000 2. Jackson Company has a policy of maintaining an inventory of finished goods equal to 30 percent of the following month's sales. For the forthcoming month of March, Jackson has budgeted the beginning inventory at 30,000 units and the ending inventory at 33,000 units. This suggests that a. February sales are budgeted at 10,000 units less than March sales. b. March sales are budgeted at 10,000 units less than April sales. c. February sales are budgeted at 3,000 units less than March sales. d. March sales are budgeted at 3,000 units less than April sales. Budgeted sales for the first six months for Wardrope Corp. are listed below: UNITS: JANUARY 6,000 FEBRUARY 7,000 MARCH 8,000 APRIL 7,000 MAY 5,000 JUNE 4,000 3. Wardrope Corp. has a policy of maintaining an inventory of finished goods equal to 40 percent of the next month's budgeted sales. If Wardrope Corp. plans to produce 6,000 units in June, what are budgeted sales for July? a. 3,600 units b. 1,000 units c. 9,000 units d. 8,000 units 4. Budgeted sales for the first six months for Shelton Corp. are listed below: UNITS: JANUARY 5,000 FEBRUARY 6,000 MARCH 9,000 APRIL 8,000 MAY 6,000 JUNE 5,000 Shelton Corp. has a policy of maintaining an inventory of finished goods equal to 30 percent of the next month's budgeted sales. If Shelton Corp. plans to produce 8,000 units in June, what are budgeted sales for July? a. 3,000 units b. 4,500 units c. 10,000 units d. 15,000 units 5. Simmons Co. manufactures card tables. The company has a policy of maintaining a finished goods inventory equal to 40 percent of the next month's planned sales. Each card table requires 3 hours of labor. The budgeted labor rate for the coming year is $13 per hour. Planned sales for the months of April, May, and June are respectively 4,000; 5,000; and 3,000 units. The budgeted direct labor cost for June for Simmons Co. is $136,500. What are budgeted sales for July for Simmons Co.? a. 3,500 units b. 4,250 units c. 4,000 units d. 3,750 units 6. Budgeted sales for Madonna Inc. for the first quarter the year are shown below: UNITS: JANUARY 35,000 FEBRUARY 25,000 MARCH 32,000 The company has a policy that requires the ending inventory in each period to be 10 percent of the following period's sales. Assuming that the company follows this policy, what quantity of production should be scheduled for February? a. 24,300 units b. 24,700 units c. 25,000 units d. 25,700 units 7. Budgeted sales for Brittany Inc. for the second quarter the year are shown below: UNITS: APRIL 40,000 MAY 30,000 JUNE 38,000 The company has a policy that requires the ending inventory in each period to be 15 percent of the following period's sales. Assuming that the company follows this policy, what quantity of production should be scheduled for May? a. 28,800 units b. 29,700 units c. 25,000 units d. 31,200 units 8. Budgeted sales for the first six months the year for Hooper Corporation are listed below: UNITS: JANUARY 5,000 FEBRUARY 6,000 MARCH 7,000 APRIL 6,000 MAY 4,000 JUNE 3,000 Hooper Corporation has a policy of maintaining an inventory of finished goods equal to 35 percent of the next month's budgeted sales. How many units has Hooper Corporation budgeted to produce in the first quarter of the year? a. 18,350 units b. 17,650 units c. 22,000 units d. 22,050 units 9. Production of Product B has been budgeted at 200,000 units for Novenber. One unit of Product B requires 2 lbs. of raw material. The projected beginning and ending materials inventory for Novenber are: Beginning inventory: 2,000 lbs. Ending inventory: 10,000 lbs. How many lbs. of material should be purchased during Novenber? a. 192,000 b. 208,000 c. 408,000 d. 416,000 10. Production of Product 101 has been budgeted at 300,000 units for June. One unit of Product 101 requires 3 lbs. of raw material. The projected beginning and ending materials inventory for June are: Beginning inventory: 4,000 lbs. Ending inventory: 16,000 lbs. How many lbs. of material should be purchased during June? a. 288,000 b. 312,000 c. 912,000 d. 936,000 Sky High Company Sky High Company manufactures toy airplanes. Information on Sky High Company's labor costs follow: Sales commissions Administration Indirect factory labor Direct factory labor $5 per plane $10,000 per month $3 per plane $5 per plane The following information applies to the upcoming month of July for Sky High Company: Budgeted production Budget sales 1,200 units 1,000 units 11. Refer to Sky High Company. What amount of budgeted labor cost would appear in the July selling, general, and administrative expense budget? a. $10,000 b. $16,000 c. $15,000 d. $23,000 12. Refer to Sky High Company. What is Sky High's budgeted factory labor cost for July? a. $8,000 b. $15,600 c. $25,600 d. $9,600 13. For the month of November, Hopkins Corporation. predicts total cash collections to be $1 million. Also for November, Hopkins Corporation. estimates that its beginning cash balance will be $50,000 and that it will borrow cash in the amount of $70,000. If Hopkins Corporation. estimates an ending cash balance of $30,000 for November, what must its projected cash disbursements be? a. $1,090,000 b. $1,120,000 c. $1,070,000 d. $1,020,000 14. For the month of March, Burnham Corporation. predicts total cash collections to be $1.5 million. Also for March, Burnham Corporation. estimates that its beginning cash balance will be $60,000 and that it will borrow cash in the amount of $80,000. If Burnham Corporation. estimates an ending cash balance of $40,000 for March, what must its projected cash disbursements be? a. $1,520,000 b. $1,580,000 c. $1,600,000 d. $1,640,000 Payne Companies Company A Beginning cash balance Cash collections Cash disbursements Cash excess (shortage) Borrowing (repayments) Ending cash CASH BUDGET Company B Company C $100 ? 500 ? 300 200 $300 400 ? ? 100 200 $700 ? 600 400 ? 100 15. Refer to Payne Companies. For Company A, what are the budgeted cash collections? a. $700 b. $500 c. $300 d. $400 16. Refer to Payne Companies. For Company B, what are the budgeted cash disbursements? a. $600 b. $700 c. $500 d. $400 17. Refer to Payne Companies. For Company C, what are the budgeted cash collections? a. b. c. d. $200 $300 $400 $500 18. As projected net income increases the a. degree of operating leverage declines. b. margin of safety stays constant. c. break-even point goes down. d. contribution margin ratio goes up. 19. A managerial preference for a very low degree of operating leverage might indicate that a. an increase in sales volume is expected. b. a decrease in sales volume is expected. c. the firm is very unprofitable. d. the firm has very high fixed costs. Channing Company Channing Company is preparing its Manufacturing Overhead budget for the second quarter of the year. Budgeted variable factory overhead is $3.00 per unit produced; budgeted fixed factory overhead is $75,000 per month, with $16,000 of this amount being factory depreciation. 20. Refer to Channing Company. If the budgeted production for April is 6,000 units, then the total budgeted factory overhead for April is: a. $77,000 b. $82,000 c. $85,000 d. $93,000 21. Refer to Channing Company. If the budgeted production for May is 5,000 units, then the total budgeted factory overhead per unit: a. $15 b. $18 c. $20 d. $22 22. Refer to Channing Company. If the budgeted cash disbursements for factory overhead for June are $80,000, then the budgeted production for June must be: a. 7,400 units b. 6,200 units c. 6,500 units d. 7,000 units Castle Corporation The following questions are based on the following data pertaining to two types of products manufactured by Castle Corporation: Per unit Sales price Variable costs $120 $500 Product Y Product Z $ 70 $200 Fixed costs total $300,000 annually. The expected mix in units is 60 percent for Product Y and 40 percent for Product Z. 23. Refer to Castle Corporation. How much is Castle's break-even point sales in units? 24. Refer to Castle Corporation. What is Castle's break-even point in sales dollars? The Horner Company makes three products. The cost data for these three products is as follows: Product A Selling price Variable costs Product B Product C $10 7 $20 12 $40 16 Total annual fixed costs are $840,000. The firm's experience has been that about 20 percent of dollar sales come from product A, 60 percent from B, and 20 percent from C. Required: 25. Compute break-even in sales dollars. $____________ Determine the number of units to be sold at the break-even point for A#26)________ for B#27_________, for Product C_#28______.(type these answers respectively on the answer sheet). Letterman Company produces and sells two products: A and B in the ratio of 3A to 5B. Selling prices for A and B are, respectively, $1,200 and $240; respective variable costs are $480 and $160. The company's fixed costs are $1,800,000 per year. Compute the volume of sales in units of each product needed to: Required: 29. break even. (all together). 30. earn $800,000 of income before income taxes. 31. earn $800,000 of income after income taxes, assuming a 30 percent tax rate. 32. earn 12 percent on sales revenue before-tax income. 33. earn 12 percent on sales revenue in after-tax income, assuming a 30 percent tax rate
