Problem 20-4A (Algo) Manufacturing: Preparation of a complete master budget LO P1, P2, P3 The management of Zigby Manufacturing prepared the following balance sheet for March 31 ZIGGY MANUFACTURING Balance Sheet March 31 Assets Liabilities and Equity Cash $ 56,000 Liabilities Accounts receivable 382,200 Accounts payable Materials Inventory 54,200 Loan payable Finished goods inventory 337,650 Long-term note payable Equipent $ 632,000 Louity Less: Accumulated deureciation 166,000 466,000 Common stock Betained earnings Total assets 51,326,080 Total abilities and equity To prepare a master budget for Admi, May, and June, management gathers the following information $ 189,800 20,000 500.000 $ 717,000 351,000 257.280 608.200 $ 1,326,080 a. Sales for Match total 21000 units Budgeted sales in units follow April, 21000, May, 15,800, June, 21600, and July, 21000 The product's selling price is $2600 per unit and its total product costs $2010 per unit b. Raw materials inventory consists solely of direct materials that cost $20 per pound. Company policy calls for a given month's ending matenals inventory to equal 50% of the next month's direct materials requirements. The March 31 raw materials inventory is 4,210 pounds. The budgeted June 30 ending raw materials inventory is 5,600 pounds. Each finished unit requires o 50 pound of direct materials c. company policy calls for a given month's ending finished goods inventory to equal 80% of the next month's budgeted unt sales The March 31 finished goods inventory is 16,800 units d. Each finished unit requires 0 50 nour of direct labor at a rate of 512 per hour e. The predetermined variable overhead rate is $4.30 per direct labor hour. Depreciation or 37.960 per month is the only fixed factory overhead Item Sales commissions of 7% of sales are paid in the month of the sales. The saleemanager's monthly salary is $4,600 9. Monthly general and administrative expenses include $28,000 for administrative salaries and 0.5% monthly interest on the long- tem note payable n. The company budgets 30% of sales to be for cash and the remaining 70% on crean Credit sales are collected in full in the month following the sale no credit sales are collected in the month of sale) L All raw materials purchases are on credit and accounts payable are solely tied to raw materials purchases. Raw materials purchases are fully paid in the next month (none are paid in the month of purchase) The minimum ending cash balance for all months is $56,000. If necessary, the company borrows enough cash using a loan to reach the minimum Loans require an interest payment of 1% at each month-end (before any repayment. If the month-end preliminary cash balance exceeds the minimum, the excess will be used to repay any loans Dividends of $26.000 are budgeted to be declared and paid in May 1. No cash payments for income taxes are budgeted in the second calendar quarter Income tax will be assessed at 35% in the quarter and budgeted to be paid in the third calendar Quarter Required: Prepare the following budgets for the months of April, May, and June 1 Sales budget 2. Production budget 3. Direct materials budget 4. Direct labor budget 5. Factory overhead budget 6. Selling expense budget 7. General and administrative expense budget 8. Schedule of cash receipts 9. Schedule of cash payments for direct materials 10. Casti budget 11. Budgeted income statement for entire second quarter (not monthly 12. Budgeted balance sheet at June 30 Complete this question by entering your answers in the tabs below. Reda Reg4 Reg 5 Reg 6 Reg 7 Reg 8 to 10 Reg 11 Red 12 Sales budget GEY MANUFACTURING Budgets April May June Budgeted sales unit Seng price porn Total bogotes Req2 > 7. General and se budget 8. Schedule of cash 9. Schedule of cash payide materials 10. Cash budget 11. Budgeted income statement to entre second quarter (not monthly) 12. Budgeted balance sheet at June 30. Complete this question by entering your answers in the tabs below. Reg 1 Ripa 2 RE2 Reg 3 Reg 4 Reg 5 Reg 6 Reg 7 Reg 8 to 10 Req 11 Reg 12 Production budget. June Total ZIGBY MANUFACTURING Production Budget April May Budgeted sales units Calculation of desired ending inventory Next period budgeted sales units 15,800 21.600 Ratio of inventory to future sales 80% 80% 21,000 80% Total required units Units to produce Prex 1 of 1 BRE 7. Generative expense budget 8. Schedulo eccipits. 9. Schedule of payments for direct materials 10. Cash budget 11. Budgeted income statement for entire second quarter (not monthly). 12. Budgeted balance sheet at June 30. Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Rea? Reg 4 Reg 5 Req 6 Reg 7 Reg 8 to 10 Reg 11 Reg 12 Raw materials budget. (Round per unit values to 2 decimal places.) ZIGBY MANUFACTURING Direct Materials Budget April May June Units to produce Materials needed for production (pounds) Total materials required (pounds) Materials to purchase (pounds) Materials cost per pound Cost of direct matenals purchases Peex 1 of 1 Ne There to search O BI 6. Sen EDUSTER 7. General Stative expense budget. 8. Scheduleht 9. Schedule of payment for direct materials. 10. Cash budget 11. Budgeted incontestatement for entire second quarter (not monthly 12. Budgeted balance sheet at June 30. Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Req3 Real Reg 5 Reg 6 Reg 7 Req 8 to 10 Reg 11 Reg 12 Direct labor budget. (Round per unit values to 2 decimal places.) ZIGBY MANUFACTURING Direct Labor Budget April May June Total Units to produce Direct labor hours needed Cost of direct labor Prex 1 of 1 6. Sering DECE 7. General anaaminitive expense budget 8. Schedule 9. Schedule of cash payments for direct materials. 10. Cash budget 11. Budgeted Income statement for entire second quarter (not monthly) 12. Budgeted balance sheet at June 30. Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3 Reg 4 Reg 5 Reg 6 Reg 7 Reg 8 to 10 Reg 11 Req 12 Factory overhead budget. (Round variable overhead rate values to 2 decimal places.) ZIGBY MANUFACTURING Factory Overhead Budget April May June Total Direct labor hours needed Variable overhead rate per direct labor hour Budgeted variable overhead Budgeted foxed overhead Budgeted total factory overhead Ptex 1 of 1