(REMEMBER: DELETE EVERYTHING THAT APPEARS IN RED.)

Introduction (Delete this heading in your final paper.)

In your opening paragraph, very briefly introduce the purpose of your paper. Recall that you will be discussing the budget process, make or buy decisions, and nonfinancial performance measures as explained in your rubric instructions. Three or four sentences are sufficient.

Paragraph 1 (Delete this heading in your final paper.)

Using content from your submissions in Final Project Part I and your readings from Chapters 22, 23, and 25 of your Horngrens text, discuss the initial budget process.

Paragraph 2 (Delete this heading in your final paper.)

Using content from your submissions in Final Project Part I and your readings from Chapters 22, 23, and 25 of your Horngrens text, discuss the budget variances and potential reasons for variances.

Paragraph 3 (Delete this heading in your final paper.)

Using content from your submissions in Final Project Part I and your readings from Chapters 22, 23, and 25 of your Horngrens text, discuss any changes you think the company should make based on the variance analysis. What will the changes accomplish?

Paragraph 4 (Delete this heading in your final paper.)

Using content from your submissions in Final Project Part I and your readings from Chapters 22, 23, and 25 of your Horngrens text, discuss any ethical considerations of the changes you have selected based on the variance analysis. Why would you recommend these changes?

Paragraph 5 (Delete this heading in your final paper.)

Using content from your submissions in Final Project Part I and your readings from Chapters 22, 23, and 25 of your Horngrens text, discuss the considerations involved in deciding whether to buy a particular component of one of your products or make the product in-house. What factors would you consider? What are the ethical considerations? What implications could this decision have? For each option (i.e., to make or to buy), how this will impact the efficiencies of your operations?

Paragraph 6 (Delete this heading in your final paper.)

Using content from your submissions in Final Project Part I and your readings from Chapters 22, 23, and 25 of your Horngrens text, discuss what suggestions you would make for nonfinancial performance measures that the company should adopt. What are the pros and cons of each? What are the ethical considerations of your suggestions? Explain the significance of each.

Conclusion (Delete this heading in your final paper.)

The conclusion reminds the reader what your paper is about and allows you to make a final point without introducing new information. Three or four sentences are sufficient.

Sales Budget
Peyton Approved
Sales Budgets
July, August, and September 2015
		Budgeted Units	Budgeted Unit Price	Budgeted Total Dollars
Jul-15		18,000	18.00	$324,000
Aug-15		22,000	18.00	$396,000
Sep-15		20,000	18.00	$360,000
Total for the first quarter		60,000	18	$1,080,000
Production Budget
Peyton Approved
Production Budget
July, August, and September 2015
			July		August		Sept.	Total
Next months budgeted sales			22,000		20,000		24,000		66,000
Percentage of inventory to future sales			70%		70%		70%		70%
Budgeted ending inventory			15,400		14,000		16,800		46200
Add budgeted sales			18,000		22,000		20,000		60,000
Required units to be produced			33,400		36,000		36,800		106200
Deduct beginning inventory (Previous month ending inventory)			-16,800		-15,400		-14,000		-46,200
Units to be produced			16,600		20,600		22,800		60,000
Manufacturing Budget - contains raw materials budget, direct labor budget, and factory overhead budget
Peyton Approved
Raw Materials Budget
July, August, and September 2015
		July		August		Sept.		Total
Production budget (units)		16,600		20,600		22,800		60,000
Materials requirement per unit		0.5		0.5		0.5		0.5
Materials needed for production		8,300		10,300		11,400		30,000
Add budgeted ending inventory		2,060		2,280		1,980		6,320
Total materials requirements (units)		10,360		12,580		13,380		36,320
Deduct beginning inventory (previous month ending inventory)		-4,600		-2,060		-2,280		-8,940
Materials to be purchased		5,760		10,520		11,100		27,380
Material price per unit		7.75		7.75		7.75		7.75
Total cost of direct material purchases		$44,640		$81,530		$86,025		$212,195
Peyton Approved
Direct Labor Budget
July, August, and September 2015
		July		August		Sept.		Total
Budgeted production (units)		16,600		20,600		22,800		60000
Labor requirements per unit (hours)		0.5		0.5		0.5		0.5
Total labor hours needed		8,300		10,300		11,400		30,000
Labor rate (per hour)		16.00		16.00		16.00		16.00
Labor dollars		$132,800		$164,800		$182,400		$480,000
Peyton Approved
Factory Overhead Budget
July, August, and September 2015
		July		August		Sept.		Total
Budgeted production (units)		16,600		20,600		22800		60000
Variable factory overhead rate		1.35		1.35		1.35		1.35
Budgeted variable overhead		22,410		27,810		$30,780		$81,000
Fixed overhead		20,000		20,000		20,000		60,000
Budgeted total overhead		$42,410		$47,810		$50,780		$14,100
Selling Expense Budget
Peyton Approved
Selling Expense Budget
July, August, and September 2015
	July	August	Sept.		Total
Budgeted sales	$324,000	$396,000	$360,000		1080000
Sales commission percent	12%	12%	12%		12%
Sales commissions expense	38,880	47,520	43,200		$129,600
Sales salaries	3,750	3,750	3,750		11,250
Total selling expenses	$42,630	$51,270	$46,950		$140,850
General and Administrative Expense Budget
Peyton Approved
General and Administrative Expense Budget
July, August, and September 2015
	July	August	Sept.	Total
Salaries	$12,000	$12,000	$12,000	$36,000
Interest on long-term note	2,700	2,700	2,700	8,100
Total expenses	$14,700	$14,700	$14,700	$44,100

____________________________________________________________________________________________

Peyton Approved
Budget Variance Report
For the Year Ended
	Actual Results	Static Budget	Variance	Favorable/ Unfavorable
Direct materials variances
Cost/price variance	240,000	240,000	-
Efficiency variance	240,250	212,195	28,055	Unfavorable
Total direct materials variance	240,250	212,195	28,055	Unfavorable
Direct labor variances
Cost /price variance	$495,000.00	528,000	(33,000)	Favorable
Efficiency variance	528,000	480,000	(48,000)	Unfavorable
Total direct labor variance	495,000	480,000	(15,000)	Unfavorable The paper should be written against these reports.