The Balance Sheet

Problem 22-4A (Algo) Manufacturing: Preparation of a complete master budget LO P1, P2, P3 The management of Zigby Manufacturing prepared the following balance sheet for March 31 Assets Cash Accounts receivable Raw materials inventory Finished poods inventory Equipment Less: Accumulated depreciation ZIGBY MANUFACTURING Balance Sheet March 31 Lisbilities and Equity $ 57,000 abilities 406.000 Accounts payable 91,600 Loan payable 380,480 Long term note payable Equity 467,000 Common stock Retained earnings 51,402.000 Total liabilities and equity $ 206,300 29.000 500,000 $735,300 5 634,000 167,000 352,000 314,780 666,780 $ 1.402,080 Total assets ences To prepare a master budget for April, May, and June management gathers the following information o Sales for March total 23.200 units Budgeted sales in units follow. April, 23,200: May, 17100, June, 21900, and July, 23.200 The product's selling price is $2500 per unit and its total product cost is $20.50 per unit b. Raw materials inventory consists solely of direct materials that cost $20 per pound Company policy calls for a given month's ending materials inventory to equal 50% of the next month's direct materials requirements. The March 31 raw materials inventory is 4,580 pounds. The budgeted June 30 ending raw materials inventory is 5700 pounds. Each finished unit requires 0.50 pound of direct materials c. Company policy calls for a given month's ending finished goods invertory to equal 80% of the next month's budgeted unit sales The March 31 finished goods inventory is 18,560 units d. Each finished unit requires 0 50 hour of direct labot at a rate of $13 per hour e. The predetermined variable overhead rate is $440 per direct labor hour Depreciation of $37,320 per month is the only fixed factory overhead item f. Sales commissions of 5% of sales are paid in the month of the sales. The sales manager's monthly salary is $4700 9. Monthly general and administrative expenses include $29,000 for administrative salaries and 08% monthly interest on the long- term note payable h. The company budgets 30% of sales to be for cash and the remaining 70% on credit Credit sales are collected in full in the month following the sale no credit sales are collected in the month of sale) 1. All raw materials purchases are on credit and accounts payable are solely tied to raw materials purchases Raw materials purchases are fully paid in the next month one are paid in the month of purchase) 3. The minimum ending cash balance for all months is 557.000 if necessary, the company borrows enough cash using a loan to reach the minimum Loons require an interest payment of at each month end (before any repayment. If the month end preliminary cash balance exceeds the minimum the excess will be used to repay any loans k. Dividends of $27000 are budgeted to be declared and paid in May 1. No cash payments for income taxes are budgeted in the second calendar quarter Income tax will be assessed at 35% in the quarter and budgeted to be paid in the third calendar quarter m. Equipment purchases of $100.000 are budgeted for the last day of June THB New 1. No cash payments for income taxes are budgeted in the second calendar quarter. Income tax will be assessed at 35% in the and budgeted to be paid in the third calendar quarter. m. Equipment purchases of $100,000 are budgeted for the last day of June Required: Prepare the following budgets for the months of April, May, and June: 1. Sales budget 2. Production budget 3. Direct materials budget 4. Direct labor budget 5. Factory overhead budget. 6. Selling expense budget. 7. General and administrative expense budget. 8. Schedule of cash receipts. 9. Schedule of cash payments for direct materials 10. Cash budget 11. Budgeted income statement for entire second quarter (not monthly) 12. Budgeted balance sheet at June 30. Complete this question by entering your answers in the tabs below. Regi Reg 2 Reg 3 Reg 4 Reg 5 Reg 6 Reg 2 Reg 8 to 10 Reg 11 Req 12 Budgeted balance sheet at June 30. (Round your final answers to the nearest whole dollar) ZIGBY MANUFACTURING Budgeted Balance Sheet June 30 Assets $ 124.470 Cash Accounts receivable Raw materials inventory Finished goods inventory Total current assets Equipment $ 124.470 Reg 2 Reg 3 Reg 1 Reg 4 Reg 5 Reg 6 Req 7 Reg 12 Req 8 to 10 Req 11 Budgeted balance sheet at June 30. (Round your final answers to the nearest whole dollar.) ZIGBY MANUFACTURING Budgeted Balance Sheet June 30 Assets 124 470 Cash Accounts receivable Raw materials inventory Finished goods inventory Total current assets Equipment s 124 470 es 0 Equipment, net Total assets Liabilities and Equity Liabilities Accounts payable Bank loan payable 0 Total current liabilities Equity Common stock Retained earnings Total Equity Total Liabilities and Equity