Please prepare the following budgets and other financial information as required. Sales budget, Production budget, Raw Materials budget, Direct Labor budget, Factory Overhead budget, Selling expense budget, General and Administrative expense budget, Cash budget, Budgeted Income Statement for entire first quarter, Budgeted Balance Sheet as of the end of the second quarter.
The management of Zigby Manufacturing prepared the following estimated balance sheet for March, 2013: To prepare a master budget for April, May, and June of 2013, management gathers the following information: Sales for March total 20, 500 units. Forecasted sales in units are as follows: April, 20, 500; May, 19, 500: June, 20, 000; July, 20, 500. Sales of 240, 000 units are forecasted for the entire year. The product's selling price is 23. 85 per unit and its total product cost is 19. 85 per unit. Company policy calls for a given month's ending raw materials inventory to equal 50% of the next month's materials requirements. The March 31 raw materials inventory is 4, 925 units, which complies with the policy. The expected June 30 ending raw materials inventory is 4, 000 units. Raw materials cost 20 per unit. Each finished unit requires 0. 50 units of raw materials. 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 16, 400 units, which complies with the policy. Each finished unit requires 0. 50 hours of direct labor at a rate of $15 per hour. Overhead is allocated based on direct labor hours. The predetermined variable overhead rate is 2. 70 per direct labor hour. Depreciation of 20, 000 per month is treated as fixed factor} overhead. Sales representatives' commissions are 8% of sales and are paid in the month of the sales. The sales manager's monthly salary is 3, 000 per month. Monthly general and administrative expenses include 12, 000 administrative salaries and 0. 9% monthly interest on the long-term note payable. 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). All raw materials purchases are on credit, and no payables arise from any other transactions. One month's raw materials purchases are fully paid in the next month. The minimum ending cash balance for all months is 40, 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. Dividends of 10, 000 are to be declared and paid in May. No cash payments for income taxes are to be made during the second calendar quarter. Income tax will be assessed at 35% in the quarter and paid in the third calendar quarter. Equipment purchases of 130, 000 are budgeted for the last day of June. The management of Zigby Manufacturing prepared the following estimated balance sheet for March, 2013: To prepare a master budget for April, May, and June of 2013, management gathers the following information: Sales for March total 20, 500 units. Forecasted sales in units are as follows: April, 20, 500; May, 19, 500: June, 20, 000; July, 20, 500. Sales of 240, 000 units are forecasted for the entire year. The product's selling price is 23. 85 per unit and its total product cost is 19. 85 per unit. Company policy calls for a given month's ending raw materials inventory to equal 50% of the next month's materials requirements. The March 31 raw materials inventory is 4, 925 units, which complies with the policy. The expected June 30 ending raw materials inventory is 4, 000 units. Raw materials cost 20 per unit. Each finished unit requires 0. 50 units of raw materials. 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 16, 400 units, which complies with the policy. Each finished unit requires 0. 50 hours of direct labor at a rate of $15 per hour. Overhead is allocated based on direct labor hours. The predetermined variable overhead rate is 2. 70 per direct labor hour. Depreciation of 20, 000 per month is treated as fixed factor} overhead. Sales representatives' commissions are 8% of sales and are paid in the month of the sales. The sales manager's monthly salary is 3, 000 per month. Monthly general and administrative expenses include 12, 000 administrative salaries and 0. 9% monthly interest on the long-term note payable. 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). All raw materials purchases are on credit, and no payables arise from any other transactions. One month's raw materials purchases are fully paid in the next month. The minimum ending cash balance for all months is 40, 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. Dividends of 10, 000 are to be declared and paid in May. No cash payments for income taxes are to be made during the second calendar quarter. Income tax will be assessed at 35% in the quarter and paid in the third calendar quarter. Equipment purchases of 130, 000 are budgeted for the last day of June
