The data below pertains to the Second quarter of Toysty Company which manufactures toys. Below are the estimated sales in units): April May June July August 35,000 46,000 45,000 20,000 15,000 a. The selling price of the toy is 20 AED per unit. b. All sales are on account. Based on previous experience, sales are collected in the following pattern: Month of sale 25% Month following sale 70% Uncollectible 5% c. March 31st Account Receivable showed a balance of 30,000 AED that will be collected in full in April. d. The company maintains finished goods inventories equal to 20% of the following month's sales. On March 31st, 2,500 units were in hands. e. Each toy requires 5 pounds of raw materials. f. The company requires that the ending inventory of raw materials be equal to 25% of the following month's production needs. g. On March 31st 16,000 pounds of material are on hand. h. The raw material costs AED 2 per pound. 1.50% of a month's purchases of raw materials is paid in the month of purchase the remainder is paid for in the following month. j. On March 31st accounts payable balance is AED 34,000. k. The direct labor cost is directly given to you as below: April May June Quarter AED 25,000 AED 35,000 AED 45,000 AED 105,000 1. Cost of goods sold per unit is $5.25 m. Selling and administrative expense budget for the quarter is $234,500 Cover Page and Formatting 1. Cover page 2. Table of contents 3. Formatting Total of Cover (2 marks) (2 marks) (1 marks) (5 marks) PART 1: (55 marks) 1. Prepare a sales budget, by month and in total, for the Second quarter. (5 marks) 2. Prepare a schedule of expected cash collections, by month and in total, for the Second quarter. (15 marks) 3. Prepare a production budget for each of the months April May June, and July (10 marks) 4. Prepare a direct materials budget, by month and in total, for the Second quarter (10 marks) 5. Prepare a schedule of expected cash disbursements, by month and in total, for the Second quarter. (10 marks) 6. Prepare the direct labor Budget, by month and in total for the Second Quarter (5 marks) PART II: (30 MARKS) Prepare Cash Budget with the following assumptions provided by Ontario: The company, maintains a 20% open line of credit for AED 150,000 with a local bank The Company maintains a minimum cash balance of AED 25,000 . The company borrows on the first day of the month and repays loans on the last day of the month. The company Pays a cash dividend of AED 65,000 in April. The Company Purchases AED 75,000 of equipment in May and another one for AED 45,000 in June (both purchases paid in cash). . The company has an April 1 cash balance of AED 75,000 A Cash Budget (30 marks) Part III: Prepare Budgeted Income Statement for quarter ending le, as of June 30 (10 marks) The data below pertains to the Second quarter of Toysty Company which manufactures toys. Below are the estimated sales in units): April May June July August 35,000 46,000 45,000 20,000 15,000 a. The selling price of the toy is 20 AED per unit. b. All sales are on account. Based on previous experience, sales are collected in the following pattern: Month of sale 25% Month following sale 70% Uncollectible 5% c. March 31st Account Receivable showed a balance of 30,000 AED that will be collected in full in April. d. The company maintains finished goods inventories equal to 20% of the following month's sales. On March 31st, 2,500 units were in hands. e. Each toy requires 5 pounds of raw materials. f. The company requires that the ending inventory of raw materials be equal to 25% of the following month's production needs. g. On March 31st 16,000 pounds of material are on hand. h. The raw material costs AED 2 per pound. 1.50% of a month's purchases of raw materials is paid in the month of purchase the remainder is paid for in the following month. j. On March 31st accounts payable balance is AED 34,000. k. The direct labor cost is directly given to you as below: April May June Quarter AED 25,000 AED 35,000 AED 45,000 AED 105,000 1. Cost of goods sold per unit is $5.25 m. Selling and administrative expense budget for the quarter is $234,500 Cover Page and Formatting 1. Cover page 2. Table of contents 3. Formatting Total of Cover (2 marks) (2 marks) (1 marks) (5 marks) PART 1: (55 marks) 1. Prepare a sales budget, by month and in total, for the Second quarter. (5 marks) 2. Prepare a schedule of expected cash collections, by month and in total, for the Second quarter. (15 marks) 3. Prepare a production budget for each of the months April May June, and July (10 marks) 4. Prepare a direct materials budget, by month and in total, for the Second quarter (10 marks) 5. Prepare a schedule of expected cash disbursements, by month and in total, for the Second quarter. (10 marks) 6. Prepare the direct labor Budget, by month and in total for the Second Quarter (5 marks) PART II: (30 MARKS) Prepare Cash Budget with the following assumptions provided by Ontario: The company, maintains a 20% open line of credit for AED 150,000 with a local bank The Company maintains a minimum cash balance of AED 25,000 . The company borrows on the first day of the month and repays loans on the last day of the month. The company Pays a cash dividend of AED 65,000 in April. The Company Purchases AED 75,000 of equipment in May and another one for AED 45,000 in June (both purchases paid in cash). . The company has an April 1 cash balance of AED 75,000 A Cash Budget (30 marks) Part III: Prepare Budgeted Income Statement for quarter ending le, as of June 30 (10 marks)
