The management of Zigby Manufacturing prepared the following balance sheet for March 31. ZIGBY MANUFACTURING Balance Sheet March 31 Assets Liabilities and Equity Cash $40,000 Liabilities Accounts receivable. Raw materials inventory 344,400 Accounts payable $201,000 98,500 Loan payable 12,000 Finished goods inventory 325,540 Long-term note payable 500,000 Equipment Less: Accumulated depreciation $ 600,000 150,000 Equity 450,000 Common stock 335,000 ces Retained earnings 210,440 Total assets $ 1,258,440 Total liabilities and equity $ 713,000 545,440 $1,258,440 To prepare a master budget for April, May, and June, management gathers the following information. a. Sales for March total 20,500 units. Budgeted sales in units follow: April, 20,500; May, 19,500; June, 20,000; and July, 20,500. The product's selling price is $24.00 per unit and its total product cost is $19.85 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 4,925 pounds. The budgeted June 30 ending raw materials inventory is 4,000 pounds. Each finished unit requires 0.50 pound of direct materials. c. Company policy calls for a given month's ending finished goods inventory to equal 80% of the next month's budgeted unit sales. The March 31 finished goods inventory is 16,400 units. d. Each finished unit requires 0.50 hour of direct labor at a rate of $15 per hour. e. The predetermined variable overhead rate is $2.70 per direct labor hour. Depreciation of $20,000 per month is the only fixed factory overhead item. f. Sales commissions of 8% of sales are paid in the month of the sales. The sales manager's monthly salary is $3,000. g. Monthly general and administrative expenses include $12,000 for administrative salaries and 0.9% monthly interest on the long- g. Monthly general and administrative expenses Include $12,000 for administrative salaries and 0.9% 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). i. 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 (none are paid in the month of purchase). J. The minimum ending cash balance for all months is $40,000. If necessary, the company borrows enough cash using a loan to reach the minimum. Loans require an interest payment of 1% 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 $10,000 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. 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, 2.5 points Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req 3 Req 4 eBook Req 5 Req 6 Req 7 Req 8 to 10 Req 11 Req 12 Print References Direct labor budget. (Round per unit values to 2 decimal places.) Units to produce Direct labor hours needed. ZIGGY MANUFACTURING Direct Labor Budget April May June Total Cost of direct labor i 0 2.5 points Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req 3 Req 4 Req 5 Req 6 Req 7 Req 8 to 10 1 Req 11 Reg 12 Book Print Factory overhead budget. (Round variable overhead rate values to 2 decimal places.) References Direct labor hours needed Variable overhead rate per direct labor hour Budgeted variable overhead Budgeted fixed overhead Budgeted total factory overhead ZIGBY MANUFACTURING Factory Overhead Budget April May June Total 25 points Complete this question by entering your answers in the tabs below. Req 1 Req 21 Req 3 Req 4 Req 5 Reg 6 Req 7 Req 8 to 10 Req 11 Req 12 Print Selling expense budget. Bences ZIGBY MANUFACTURING Selling Expense Budget April May June Budgeted sales Sales commissions 25 points Complete this question by entering your answers in the tabs below. +Book Req 1 Req 2 Req 3 Req 4 Req 5 Req 6 Reg 7 Reg 8 to 10 Req 11 Req 12 Prim General and administrative expense budget. ZIGBY MANUFACTURING General and Administrative Expense Budget April May June $ 0 Total general and administrative expenses $ 0 + Req 1 Reg 21 Req3 Req 4 Req 5 Req6 Req 7 Req 8 to 10 Req 11 Req 12 25 points 8. Schedule of cash receipts. 9. Schedule of cash payments for direct materials. 10. Cash budget. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign.) Print References Sales ZBGY MANUFACTURING Schedule of Cash Receipts April May June $ 492,000 $ 468,000 $ 480,000 Cash receipts from Cash sales Collections of prior period sales Total cash receipts $ 0 $ 0 $ Schedule of Cash Payments for Direct Materials Materials purchases April May June 5 190,000 $ 201,500 $ 182,000 Cash payments for Current period purchases Prior penod purchases Total cash payments $ 03 05 0 Show less 4 2.5 points eBook Beginning cash balance Total cash available Less: Cash payments for Print References Total cash payments Preliminary cash balance Ending cash balance Cash Budget April May June 0 Loan balance - Beginning of month Additional loan (loan repayment) Loan balance-End of month Loan balance April May June $ 0 < Req 7 Req 11 > 2.5 points Budgeted income statement for entire second quarter (not monthly). (Round your final answers to the nearest w ZIGBY MANUFACTURING Budgeted Income Statement For Three Months Ended June 30 eBook Print References Selling, general and administrative expenses Total operating expenses 0 0 $ 0 + 2.5 points eBook Print References Total assets Liabilities: Equity ZIGBY MANUFACTURING Budgeted Balance Sheet June 30 Assets Liabilities and Equity Total Liabilities and Equity 0