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Current Assets as of December 31 (prior year): 4,500 47,000 15,400 Property, plant, and equipment, net..S122,000 S 42,400 $ 125,500 23,400 Cash Accounts receivable, net Inventory Accounts payable.. Capital stock Retained earnings... it. Print Done Requirements 1. Prepare a schedule of cash collections for January, February, and March, and for the quarter in total. 2. Prepare a production budget. (Hint: Unit sales - Sales in dollars / Selling price per unit) 3. Prepare a direct materials budget 4. Prepare a cash payments budget for the direct material purchases from Requirement 3. 5. Prepare a cash payments budget for direct labor 6. Prepare a cash payments budget for manufacturing overhead costs. 7. Prepare a cash payments budget for operating expenses. 8. Prepare a combined cash budget 9. Calculate the budgeted manufacturing cost per unit (assume that fixed manufacturing overhead is budgeted to be $0.90 per unit for the year) Prepare a budgeted income statement for the quarter ending March 31. (Hint Cost of goods sold- Budgeted cost of manufacturing one unit x Number of units sold.) 10. Requirement 1. Prepare a schedule of cash collections for January, February, and March, and for the quarter in total Decker Manufacturing Cash Collections Budget For the Quarter Ended March 31 Month January February March Quarter Cash sales Credits sales Requirement 2. Prepare a production budget. (Hint Unit sales - Sales in dollars/ Selling price per unit) Decker Manufacturing Production Budget For the Quarter Ended March 31 Month January February March Quarter Unit sales Plus: Desired ending inventory Total needed Less: Beginning inventory Units to produce Requirement 3. Prepare a direct materials budget. (Round your answers to the nearest whole dollar) Decker Manufacturing Direct Materials Budget For the Quarter Ended March 31 Month January February Ma rch Quarter Units to be produced Multiply by: Quantity (pounds) of DM needed per unit Quantity (pounds) needed for production Plus: Desired ending inventory of DM Total quantity (pounds) needed Less: Beginning inventory of DM Quantity (pounds) to purchase Multiply by. Cost per pound Total cost of DM Durchases Requirement 4. Prepare a cash payments budget for the direct material purchases from Requirement 3. (Round your a Decker Manufacturing Cash Payments for Direct Materials Budget For the Quarter Ended March 31 Month January February March Quarter 20% of current month DM purchases 80% of last month's DM purchases Total cash payments Requirement 5. Prepare a cash payments budget for direct labor Decker Manufacturing Cash Payments for Direct Labor Budget For the Quarter Ended March 31 Month January February March Quarter Total cost of direct labor Requirement 6. Prepare a cash payments budget for manufacturing overhead costs. (Round your answers to the nearest whole dolar Decker Manufacturing Cash Payments for Manufacturing Overhead Budget For the Quarter Ended March 31 Month January February March Quarter Variable manufacturing overhead costs Rent (fixed) Other fixed MOH Cash payments for manufacturing overhead Requirement 7. Prepare a cash payments budget for operating expenses (Round your answers to the nearest whole dollar.) Decker Manufacturing Cash Payments for Operating Expenses Budget For the Quarter Ended March 31 Month JanuaryFebruary March Quarter Variable operating expenses Fixed operating expenses Cash payments for operating expenses- Requirement 8. Prepare a combined cash budget. (If a box is not used in the table leave the box empty, do not enter a zero. Use parenthese Decker Manufacturing Combined Cash Budget Quarter Plus: Cash collections Less: cash payments Direct material purchases Direct labor Manufacturing overhead costs Operating expenses Tax payment Requirement 9.Calculate the budgeted manufacturing cost per unit (assume that fxed manufacturing overhead is budgeted to be S0 90 per unit for the year) (Round yo Decker Manufacturing Budgeted Manufacturing Cost per Unit For the Quarter Ended March 31 Direct materials cost per unit Direct labor cost per unit variable manufacturing overhead costs per unit Fixed manufacturing overhead costs per unit Budgeted cost of manufacturing one unit ] cost of Budgeted Income Statement Less Cost of goods sold More Info a Actual sales in December were $70,000. Selling price per unit is projected to remain stable at $10 per unit throughout the budget period. Sales for the first five months of the upcoming year are budgeted to be as follows: January . February March April May $ 80,000 $ 92,000 99,000 $ 97,000 $ 85,000 b,Sales are 30% cash and 70% credit All credit sales are collected in the month following the sale. c.Decker Manufacturing has a policy that states that each month's ending inventory of finished goods should be 25% of the following month's sales (in units) d.Of each month's direct material purchases, 20% are paid for in the month of purchase, while the remainder is paid for in the month following purchase. Two pounds of direct material is needed per unit at $2.00 per pound. Ending inventory of direct materials should be 10% of next month's production needs e.Most of the labor at the manufacturing facility is indirect, but there is some direct labor incurred. The direct labor hours per unit is 001. The direct labor rate per hour is $12 per hour. All direct labor is paid for in the month in which the work is performed. The direct labor total cost for each of the upcoming three months is as follows: January February March 996 s 1,125 $ 1,182 e.Most of the labor at the manufacturing facility is indirect, but there is some direct labor incurred. The direct labor hours per unit is 0.01. The direct labor rate per hour is $12 per hour. All direct labor is paid for in the month in which the work is performed. The direct labor total cost for each of the upcoming three months is as follows January February March $ 996 1,125 $ 1,182 1otly manufacturing overhoad costs are $5,000 tor factory rent, $3,000 for other fixed manufacturing expenses, and $1 20 por unit for variable manufacturing overhead. No depreciation is included in these figures. All expenses are paid in the month in which they are incurred. gComputer equipment for the administrative offices will be purchased in the upcoming quarter. In January, Decker Manufacturing will purchase equipment for $5,000 (cash), while February's cash expenditure will be $12,000 and March's cash expenditure will be $16,000 h.Operating expenses are budgeted to be $1.00 per unit sold plus fixed operating expenses of $1,000 per month. All operating expenses are paid in the month in which they are incurred. No depreciation is included in these figures. . Depreciation on the building and equipment for the general and administrative offices is budgeted to be entire quarter, which includes depreciation on new acquisitions j. Decker Manufacturing has a policy that the ending cash balance in each month must be at least $4,000. It has a line of credit with a local bank The company can borrow in increments of $1,000 at the beginning of each month, up to a total outstanding loan balance of $100,000 The interest rate on these loans 1 % per month simple Interest (not compoun nded The companywould pay down on the line of credit balance in increments of $1,000 if it has excess funds at the end of the quarter. The company ng et March also pay the accumulated interest at the end of the quarter on the funds borrowed during the quarter. of operating income less interest expense The company pays $10,000 K. The companys income tax rate is projected to be 30% cash at the end of February in estimated taxes
