Prepare Gavin's annual financial budget for 2019, including budgeted income statement, budgeted balance sheet, amd budgeted statment of cash flows.

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flows Requirement 2. Prepare Gavin's annual financial budget for 2019, including budgeted income statement, budgeted balance shoot, and budgeted statement of cash Begin with the budgeted income statement. (Complete all input fields. Entot a "o" for any zoro balances) Review the sales budget you prepared above. Review the cost of goods sold budget you prepared above. Review the song and administrative expense budget you prepared above Review the cash budget you prepared above. Gavin Tire Company Enter any number in the edit fields and then click Check Antwer. Cost of Goods Sold Gross Profit Selling and Administrative Expenses Operating Income Interest Expense Income before Income Taxes Income Tax Expense Net Income Gavin Tire Company Sales Budget For the Year Ended December 31, 2019 First Second Third Quarter Quarter Quarter Fourth Quarter Total Budgeted tires to be sold 1,000 70||$ 1,200 70 $ 1,400 70 $ 1,600 70 $ 5,200 70 $ Sales price per unit $ 70,000 $ 84,000 $ 98,000 $ 112,000 $ 364.000 Total sales Gavin Tire Company Cost of Goods Sold Budget For the Year Ended December 31, 2019 First Second Third Quarter Quarter Quarter Fourth Quarter Total $ $ Beginning inventory Tires produced and sold in 2019 10,800 21,700$ 10,800 151,900 43,400 $ 49,600 37,200 $ 37.200 $ Total budgeted cost of goods sold 32,500 $ 43,400 $ 49,600 $ 162,700 Fourth Quarter Total Selling and Administrative Expense Budget For the Year Ended December 31, 2019 First Second Third Quarter Quarter Quarter Salaries Expense $ 8,000 $ 8,000 $ 8,000 $ Rent Expense 4,800 4.800 4,800 Insurance Expense 1,950 1,950 1,950 Depreciation Expense 2,000 2,000 2,000 1,400 1,680 Supplies Expenso 1.960 Total budgeted selling and administrative expense 18,150 $ 18,430 18,710 $ 8,000 $ 4,800 1.950 2,000 2,240 32,000 19,200 7,800 8,000 7.280 18,990$ 74,280 Gavin Tire Company Cash Budget For the Year Ended December 31, 2019 First Second Quarter Quarter S 20,000 $ 20,010 S 81,100 80,220 Third Fourth Quarter Quarter Total 35,920$ 94,220 71,150 $ 108,220 20,000 363,760 Beginning cash balance Cash receipts Cash available Cash payments Capital expenditures 101,100 100,230 130,140 179,370 383,760 25,000 0 0 0 25,000 Udove TUUSU TOU, 1901 TTYSTU 303,70U 0 0 0 Cash payments: Capital expenditures Purchases of direct materials Direct labor Manufacturing overhead Selling and administrative expenses Income taxos Interest expense Total cash payments Ending cash balance before financing 25,000 22,960 7,080 14,400 16,150 3,500 0 13,760 7.680 14,700 16,430 3,500 240 14,600 8,880 15,300 16,710 3,500 0 14,340 10,080 15.900 16,990 3,500 0 25,000 65,680 33,720 60,300 66,280 14,000 240 89,090 56,310 58,990 60,810 265,200 12,010 43,920 71.150 118,560 118,560 Interest expense 2 89,090 56,310 58,990 60,810 265,200 12,010 (20,000) 43,920 (20,000) 71,150 (20,000) 118,560 (20,000) 118,560 (20,000) (7.990) 23,920 51,150 98,560 98,560 Total cash payments Ending cash balance before financing Minimum cash balance desired Projected cash excess (de ciency) Financing Borrowing Principal repayments Total effects of financing Ending cash balance 8,000 0 0 0 (8,000) 0 8,000 (8,000) 0 0 8,000 (8,000) 0 0 20,010 $ 35,920 $ 71,150 $ 118,560 118,560 (Unless otherwise noted, assume all of the following events occurred during 2018 and that any balances given are stated as of December 31, 2018.) Budgeted sales are 1,000 tires for the first quarter and expected to increase by 200 tires per quarter. a. Cash sales are expected to be 10% of total sales, with the remaining 90% of sales on account. b. Finished Goods Inventory on December 31, 2018 consists of 300 tires at $36 each. Desired ending Finished Goods Inventory is 40% of the next quarter's sales; first quarter sales for 2020 c. are expected be 1,800 tires. FIFO inventory costing method is used. Raw Materials Inventory on December 31, 2018, consists of 750 pounds of rubber compound used to d. manufacture the tires. Direct materials requirements are 2.50 pounds of a rubber compound per tire. The cost of the e. compound is $4.00 per pound. Desired ending Raw Materials Inventory is 40% of the next quarter's direct materials needed for production; desired ending inventory for December 31, 2019 is 750 pounds; indirect materials are f. insignificant and not considered for budgeting purposes. 9. Each tire requires 0.30 hours of direct labor; direct labor costs average $20 per hour. TYTUT Fixed manufacturing overhead includes $6,000 per quarter in depreciation and $10,860 per quarter for i. other costs, such as utilities, insurance, and property taxes. Fixed selling and administrative expenses include $8,000 per quarter for salaries; $4,800 per quarter for i rent; $1,950 per quarter for insurance; and $2,000 per quarter for depreciation. k. Variable selling and administrative expenses include supplies at 2% of sales. Capital expenditures include $25,000 for new manufacturing equipment, to be purchased and paid in 1. the first quarter. Cash receipts for sales on account are 70% in the quarter of the sale and 30% in the quarter following the sale; December 31, 2018, Accounts Receivable is received in the first quarter of 2019, uncollectible m. accounts are considered insignificant and not considered for budgeting purposes. Direct materials purchases are paid 50% in the quarter purchased and 50% in the following quarter; n. December 31, 2018, Accounts Payable is paid in the first quarter of 2019. Direct labor, manufacturing overhead, and selling and administrative costs are paid in the quarter o incurred. p. Income tax expense is projected at $3,500 per quarter and is paid in the quarter incurred. vandle semng anu auminsauve expenses include suppres al 27 Ur Sales. Capital expenditures include $25,000 for new manufacturing equipment, to be purchased and paid in 1. the first quarter. Cash receipts for sales on account are 70% in the quarter of the sale and 30% in the quarter following the sale: December 31, 2018, Accounts Receivable is received in the first quarter of 2019; uncollectible m. accounts are considered insignificant and not considered for budgeting purposes. Direct materials purchases are paid 50% in the quarter purchased and 50% in the following quarter: n. December 31, 2018, Accounts Payable is paid in the first quarter of 2019. Direct labor, manufacturing overhead, and selling and administrative costs are paid in the quarter o incurred. p. Income tax expense is projected at $3,500 per quarter and is paid in the quarter incurred. Gavin desires to maintain a minimum cash balance of $20,000 and borrows from the local bank as needed in increments of $1,000 at the beginning of the quarter; principal repayments are made at the beginning of the quarter when excess funds are available and in increments of $1,000; interest is 12% per year and paid at the beginning of the quarter based on the amount outstanding from the previous 4. quarter. Gavin Tire Company Balance Sheet December 31, 2018 Assets -a " pard Current Assets: dollar. Er Cash 20,000 Accounts Receivable win Raw Materials Inventory 30,000 3,000 10,800 Cas Finished Goods Inventory Total Current Assets Eng 63,800 Property, Plant, and Equipment: EKA Less: Accumulated Depreciation (39,000) 129,000 Total Assets $ 192,800 Liabilities " are 16,000 Current Liabilities: Accounts Payable $ Stockholders' Equity Common Stock, no par 130,000 Retained Earnings 46,800 Total Stockholders' Equity $ Total Liabilities and Stockholders' Equity m ca nd 176,800 192,800 flows Requirement 2. Prepare Gavin's annual financial budget for 2019, including budgeted income statement, budgeted balance shoot, and budgeted statement of cash Begin with the budgeted income statement. (Complete all input fields. Entot a "o" for any zoro balances) Review the sales budget you prepared above. Review the cost of goods sold budget you prepared above. Review the song and administrative expense budget you prepared above Review the cash budget you prepared above. Gavin Tire Company Enter any number in the edit fields and then click Check Antwer. Cost of Goods Sold Gross Profit Selling and Administrative Expenses Operating Income Interest Expense Income before Income Taxes Income Tax Expense Net Income Gavin Tire Company Sales Budget For the Year Ended December 31, 2019 First Second Third Quarter Quarter Quarter Fourth Quarter Total Budgeted tires to be sold 1,000 70||$ 1,200 70 $ 1,400 70 $ 1,600 70 $ 5,200 70 $ Sales price per unit $ 70,000 $ 84,000 $ 98,000 $ 112,000 $ 364.000 Total sales Gavin Tire Company Cost of Goods Sold Budget For the Year Ended December 31, 2019 First Second Third Quarter Quarter Quarter Fourth Quarter Total $ $ Beginning inventory Tires produced and sold in 2019 10,800 21,700$ 10,800 151,900 43,400 $ 49,600 37,200 $ 37.200 $ Total budgeted cost of goods sold 32,500 $ 43,400 $ 49,600 $ 162,700 Fourth Quarter Total Selling and Administrative Expense Budget For the Year Ended December 31, 2019 First Second Third Quarter Quarter Quarter Salaries Expense $ 8,000 $ 8,000 $ 8,000 $ Rent Expense 4,800 4.800 4,800 Insurance Expense 1,950 1,950 1,950 Depreciation Expense 2,000 2,000 2,000 1,400 1,680 Supplies Expenso 1.960 Total budgeted selling and administrative expense 18,150 $ 18,430 18,710 $ 8,000 $ 4,800 1.950 2,000 2,240 32,000 19,200 7,800 8,000 7.280 18,990$ 74,280 Gavin Tire Company Cash Budget For the Year Ended December 31, 2019 First Second Quarter Quarter S 20,000 $ 20,010 S 81,100 80,220 Third Fourth Quarter Quarter Total 35,920$ 94,220 71,150 $ 108,220 20,000 363,760 Beginning cash balance Cash receipts Cash available Cash payments Capital expenditures 101,100 100,230 130,140 179,370 383,760 25,000 0 0 0 25,000 Udove TUUSU TOU, 1901 TTYSTU 303,70U 0 0 0 Cash payments: Capital expenditures Purchases of direct materials Direct labor Manufacturing overhead Selling and administrative expenses Income taxos Interest expense Total cash payments Ending cash balance before financing 25,000 22,960 7,080 14,400 16,150 3,500 0 13,760 7.680 14,700 16,430 3,500 240 14,600 8,880 15,300 16,710 3,500 0 14,340 10,080 15.900 16,990 3,500 0 25,000 65,680 33,720 60,300 66,280 14,000 240 89,090 56,310 58,990 60,810 265,200 12,010 43,920 71.150 118,560 118,560 Interest expense 2 89,090 56,310 58,990 60,810 265,200 12,010 (20,000) 43,920 (20,000) 71,150 (20,000) 118,560 (20,000) 118,560 (20,000) (7.990) 23,920 51,150 98,560 98,560 Total cash payments Ending cash balance before financing Minimum cash balance desired Projected cash excess (de ciency) Financing Borrowing Principal repayments Total effects of financing Ending cash balance 8,000 0 0 0 (8,000) 0 8,000 (8,000) 0 0 8,000 (8,000) 0 0 20,010 $ 35,920 $ 71,150 $ 118,560 118,560 (Unless otherwise noted, assume all of the following events occurred during 2018 and that any balances given are stated as of December 31, 2018.) Budgeted sales are 1,000 tires for the first quarter and expected to increase by 200 tires per quarter. a. Cash sales are expected to be 10% of total sales, with the remaining 90% of sales on account. b. Finished Goods Inventory on December 31, 2018 consists of 300 tires at $36 each. Desired ending Finished Goods Inventory is 40% of the next quarter's sales; first quarter sales for 2020 c. are expected be 1,800 tires. FIFO inventory costing method is used. Raw Materials Inventory on December 31, 2018, consists of 750 pounds of rubber compound used to d. manufacture the tires. Direct materials requirements are 2.50 pounds of a rubber compound per tire. The cost of the e. compound is $4.00 per pound. Desired ending Raw Materials Inventory is 40% of the next quarter's direct materials needed for production; desired ending inventory for December 31, 2019 is 750 pounds; indirect materials are f. insignificant and not considered for budgeting purposes. 9. Each tire requires 0.30 hours of direct labor; direct labor costs average $20 per hour. TYTUT Fixed manufacturing overhead includes $6,000 per quarter in depreciation and $10,860 per quarter for i. other costs, such as utilities, insurance, and property taxes. Fixed selling and administrative expenses include $8,000 per quarter for salaries; $4,800 per quarter for i rent; $1,950 per quarter for insurance; and $2,000 per quarter for depreciation. k. Variable selling and administrative expenses include supplies at 2% of sales. Capital expenditures include $25,000 for new manufacturing equipment, to be purchased and paid in 1. the first quarter. Cash receipts for sales on account are 70% in the quarter of the sale and 30% in the quarter following the sale; December 31, 2018, Accounts Receivable is received in the first quarter of 2019, uncollectible m. accounts are considered insignificant and not considered for budgeting purposes. Direct materials purchases are paid 50% in the quarter purchased and 50% in the following quarter; n. December 31, 2018, Accounts Payable is paid in the first quarter of 2019. Direct labor, manufacturing overhead, and selling and administrative costs are paid in the quarter o incurred. p. Income tax expense is projected at $3,500 per quarter and is paid in the quarter incurred. vandle semng anu auminsauve expenses include suppres al 27 Ur Sales. Capital expenditures include $25,000 for new manufacturing equipment, to be purchased and paid in 1. the first quarter. Cash receipts for sales on account are 70% in the quarter of the sale and 30% in the quarter following the sale: December 31, 2018, Accounts Receivable is received in the first quarter of 2019; uncollectible m. accounts are considered insignificant and not considered for budgeting purposes. Direct materials purchases are paid 50% in the quarter purchased and 50% in the following quarter: n. December 31, 2018, Accounts Payable is paid in the first quarter of 2019. Direct labor, manufacturing overhead, and selling and administrative costs are paid in the quarter o incurred. p. Income tax expense is projected at $3,500 per quarter and is paid in the quarter incurred. Gavin desires to maintain a minimum cash balance of $20,000 and borrows from the local bank as needed in increments of $1,000 at the beginning of the quarter; principal repayments are made at the beginning of the quarter when excess funds are available and in increments of $1,000; interest is 12% per year and paid at the beginning of the quarter based on the amount outstanding from the previous 4. quarter. Gavin Tire Company Balance Sheet December 31, 2018 Assets -a " pard Current Assets: dollar. Er Cash 20,000 Accounts Receivable win Raw Materials Inventory 30,000 3,000 10,800 Cas Finished Goods Inventory Total Current Assets Eng 63,800 Property, Plant, and Equipment: EKA Less: Accumulated Depreciation (39,000) 129,000 Total Assets $ 192,800 Liabilities " are 16,000 Current Liabilities: Accounts Payable $ Stockholders' Equity Common Stock, no par 130,000 Retained Earnings 46,800 Total Stockholders' Equity $ Total Liabilities and Stockholders' Equity m ca nd 176,800 192,800