Saved Help Save & Exit Check my Exercise 8-10 Production and Direct Materials Budgets (L08-3, L08-4) Pearl Products Limited of Shenzhen, China, manufactures and distributes toys throughout South East Asia. Three cubic centimeters (cc) of solvent H300 are required to manufacture each unit of Supermix, one of the company's products. The company now is planning raw materials needs for the third quarter, the quarter in which peak sales of Supermix occur. To keep production and sales moving smoothly, the company has the following inventory requirements: a. The finished goods inventory on hand at the end of each month must equal 2,000 units of Supermix plus 20% of the next month's sales. The finished goods inventory on June 30 is budgeted to be 10,600 units b. The raw materials inventory on hand at the end of each month must equal one-half of the following month's production needs for raw materials. The raw materials inventory on June 30 is budgeted to be 66,000 cc of solvent H300. c. The company maintains no work in process inventories A monthly sales budget for Supermix for the third and fourth quarters of the year follows Budgeted Unit Sales July 43,800 August 48,000 September 58,000 October 38,000 November 28,000 December 18,000 Required: C Required: 1. Prepare a production budget for Supermix for the months July August September, and October 3. Prepare a direct materials budget showing the quantity of solvent H300 to be purchased for July August, and September, and for the quarter in total. Complete this question by entering your answers in the tabs below. Required 1 Required 3 Prepare a production budget for Supermix for the months July, August, September, and October Pearl Products Limited Production Budget July August September October Budgeted unit sales Total needs Required production in units CH Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The company's balance sheet as of June 30th is shown below: Beech Corporation Balance Sheet June 30 Assets Cash Accounts receivable Inventory Plant and equipment, net of depreciation Total assets Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings Total liabilities and stockholders' equity $ 92,000 130,000 48,600 216,000 $ 486,600 $ 77,000 329,000 80,600 $ 486,600 Exercise 8-12 Beech's managers have made the following additional assumptions and estimates: 1. Estimated sales for July August, September, and October will be $270,000, $290,000, $280,000, and $300,000, respectively. --- ---- ca Check Required information Beech's managers have made the following additional assumptions and estimates: 1. Estimated sales for July, August, September, and October will be $270,000, $290,000, $280,000, and $300,000, respectively 2. All sales are on credit and all credit sales are collected. Each month's credit sales are collected 35% in the month of sale and 65% in the month following the sale. All of the accounts receivable at June 30 will be collected in July 3. Each month's ending inventory must equal 30% of the cost of next month's sales. The cost of goods sold is 60% of sales. The company pays for 40% of its merchandise purchases in the month of the purchase and the remaining 60% in the month following the purchase. All of the accounts payable at June 30 will be paid in July 4 Monthly selling and administrative expenses are always $50,000. Each month $5,000 of this total amount is depreciation expense and the remaining $45,000 relates to expenses that are paid in the month they are incurred. 5. The company does not plan to borrow money or pay or declare dividends during the quarter ended September 30. The company does not plan to issue any common stock or repurchase its own stock during the quarter ended September 30, es Required: 1. Prepare a schedule of expected cash collections for July, August, and September 2-a. Prepare a merchandise purchases budget for July, August, and September. Also compute total merchandise purchases for the quarter ended September 30, 2-b. Prepare a schedule of expected cash disbursements for merchandise purchases for July, August, and September 3. Prepare an income statement that computes net operating income for the quarter ended September 30. 4. Prepare a balance sheet as of September 30, Complete this question by entering your answers in the tabs below. THAT HIRUR Required information 4. Prepare a balance sneeds Oi September 30. 2 Complete this question by entering your answers in the tabs below. Reg 1 Reg 2A Reg 28 Reg 3 Req 4 Prepare a schedule of expected cash collections for July, August, and September. ok Schedule of Expected Cash Collections Month July August September nces Quarter $ 0 0 0 From July sales From August sales From September sales Total cash collections 0 0 $ 0 $ 0$ 0$ Reg 2 >