Sales, production, purchases, and cash budgets Freese, Inc., is in the process of preparing the fourth quarter budget for 2013, and the following data have been assembled:

Problem 14.23 LO 4, 5, 8

Chapter 14 Cost Planning

587

March . . . . . . April . . . . . . . May . . . . . . .

6,000 units

7,000 units 10,000 units

June . . . . . . . . . . . July. . . . . . . . . . . . August . . . . . . . . .

8,000 units 9,000 units 6,000 units

The company sells a single product at a price of $60 per unit. The estimated sales volume for the next six months is as follows:

e cel

Problem 14.24 LO 4, 5, 8

x

588

Part 2

Managerial Accounting

September October . . November December January . . February. .

. ..................................

. ..................................

. ..................................

. ..................................

. ..................................

. ..................................

13,000 units 12,000 units 14,000 units 20,000 units

9,000 units 10,000 units

accounting

Case 14.25 LO 10

Required:

1. Prepare a sales budget in units and dollars, by month and in total, for the fourth quarter (October, November, and December) of 2013.

2. Prepare a schedule of cash collections from sales, by month and in total, for the fourth quarter of 2013.

3. Prepare a production budget in units, by month and in total, for the fourth quarter of 2013.

4. Prepare a materials purchases budget in pounds, by month and in total, for the fourth quarter of 2013.

5. Prepare a schedule of cash payments for materials, by month and in total, for the fourth quarter of 2013.