Required information The Chapter 8 Form worksheet is to be used to create your own worksheet version of the Review Problem in the text. Requirement 2: The company has just hired a new marketing manager who insists that unit sales can be dramatically increased by dropping the selling price from $8 to $7. The marketing manager would like to use the following projections in the budget: Data Budgeted unit sales Selling price per unit 1 50,000 $7 Year 2 Quarter 2 3 70,000 120,000 4 75,000 Year 3 Quarter 1 2 80,000 95,000 A B D E F G 1 Chapter 8: Applying Excel 2 Data Year 3 Quarter 4 4 1 2 3 4 1 2 5 Budgeted unit sales 50,000 70,000 120,000 75,000 80,000 95,000 6 $ 7 per unit 65,000 . $ . 75% 25% 7 Selling price per unit 8 Accounts receivable, beginning balance 9 Sales collected in the quarter sales are made 10 Sales collected in the quarter after sales are made 11 Desired ending finished goods inventory is 12 Finished goods inventory, beginning 13 Raw materials required to produce one unit 14 Desired ending inventory of raw materials is 15 Raw materials inventory, beginning 16 Raw material costs 17 Raw materials purchases are paid 30% of the budgeted unit sales of the next quarter 12,000 units 1999 5 pounds 10% of the next quarter's production needs 23,000 pounds 0.80 per pound 60% in the quarter the purchases are made 40% in the quarter following purchase 81,500 18 and 19 Accounts payable for raw materials, beginning balance a. What are the total expected cash collections for the year under this revised budget? Expected cash collections for the year $ 2,485,000 b. What is the total required production for the year under this revised budget? Total required production for the year 2,485,000 c. What is the total cost of raw materials to be purchased for the year under this revised budget? Total cost of raw materials to be purchased for the year $ 1,251,400 d. What are the total expected cash disbursements for raw materials for the year under this revised budget? Total expected cash disbursements for raw materials for the year $ 1,211,300 e. After seeing this revised budget, the production manager cautioned that due to the current production constraint, a complex milling machine, the plant can produce no more than 90,000 units in any one quarter. Is this a potential problem? Yes No A B C D E F H 1 1 40,000 Year 2 Quarter 2 3 60,000 100,000 4 50,000 Year 3 Quarter 1 2 70,000 80,000 $8 per unit $65,000 75% 25% 30% of the budgeted unit sales of the next quarter 12,000 units 5 pounds 10% of the next quarter's production needs 23,000 pounds $0.80 per pound 60% in the quarter the chases are made 40% in the quarter following purchase $81,500 1 Chapter 8: Applying Excel 2 3 Data 4 5 Budgeted unit sales 6 7 Selling price per unit 8 Accounts receivable, beginning balance 9 Sales collected in the quarter sales are made 10 Sales collected in the quarter after sales are made 11 Desired ending finished goods inventory is 12 Finished goods inventory, beginning 13 Raw materials required to produce one unit 14 Desired ending inventory of raw materials is 15 Raw materials inventory, beginning 16 Raw material costs 17 Raw materials rchases are paid 18 and 19 Accounts payable for raw materials, beginning balance 20 21 Enter a formula into each of the cells marked with a ? below 22 Review Problem: Budget Schedules 23 24 Construct the sales budget 25 26 Budgeted unit sales 27 Selling price per unit 28 Total sales 29 30 Construct the schedule of expected cash collections 31 32 Accounts receivable, beginning balance 33 First-quarter sales 34 Second-quarter sales 35 Third-quarter sales 36 Fourth-quarter sales 37 Total cash collections 38 1 40,000 $8 $320,000 Year 2 Quarter 2 3 60,000 100,000 $8 $8 $480,000 $800,000 4 50,000 $8 $400,000 Year 3 Quarter 1 2 70,000 80,000 $8 $8 $560,000 $640,000 $ 1 65,000 240,000 $ Year 2 Quarter 2 3 4 Year $ 65,000 80,000 320,000 360,000 $ 120,000 480,000 600,000 $ 200,000 800,000 300,000 300,000 440,000 $ 720,000 $ 500,000 $ 1,965,000 $ 305,000 $ A B D E F G H 1 J 1 40,000 18000 58,000 12,000 46,000 Year 2 Quarter 2 3 60,000 100,000 30000 15,000 90,000 115,000 18,000 30,000 72,000 85,000 4 50,000 21,000 71,000 15,000 56,000 Year 250,000 21,000 271,000 12,000 259,000 Year 3 Quarter 1 2 70,000 80,000 24,000 94,000 21,000 73,000 Year 3 Quarter 1 73,000 5 365,000 39 Construct the production budget 40 41 Budgeted unit sales 42 Add desired finished goods inventory 43 Total needs 44 Less beginning inventory 45 Required production 46 47 Construct the raw materials purchases budget 48 49 Required production (units) 50 Raw materials required to produce one unit 51 Production needs (pounds) 52 Add desired ending inventory of raw materials (pounds) 53 Total needs (pounds) 54 Less beginning inventory of raw materials (pounds) 55 Raw materials to be purchased 56 Cost of raw materials per pound 57 Cost of raw materials to be purchased 58 59 Construct the schedule of expected cash payments 60 61 Accounts payable, beginning balance 62 First-quarter purchases 63 Second-quarter purchases 64 Third-quarter purchases 65 Fourth-quarter purchases 66 Total cash disbursements 67 1 46,000 5 230,000 36000 266,000 23,000 243,000 $0.80 $194,400 Year 2 Quarter 2 3 72,000 85,000 5 5 360,000 425,000 42500 28000 402,500 453,000 36,000 42,500 366,500 410,500 $0.80 $0.80 $293,200 $328,400 4 56,000 5 280,000 36,500 316,500 28,000 288,500 $0.80 $230,800 Year 259,000 5 1,295,000 36,500 1,331,500 23,000 1,308,500 $0.80 $1,046,800 Year 2 Quarter 2 3 4 $ 1 81,500 116,640 $ 77,760 175,920 $ 117,280 197,040 $ 131,360 138,480 253,680 $ 314,320 $ 269,840 Year $ 81,500 194,400 293,200 328,400 138,480 $ 1,035,980 $ 198,140 $ 68 69 70 71