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Tilson Corporation has projected sales and production in units for the second quarter of the coming year as follows: Sales Production April 47,000 57,000 May
Tilson Corporation has projected sales and production in units for the second quarter of the coming year as follows: Sales Production April 47,000 57,000 May 37,000 47,000 June 57,000 47,000 Cash-related production costs are budgeted at $5 per unit produced. Of these production costs, 50% are paid in the month in which they are incurred and the balance in the following month. Selling and administrative expenses will amount to $50,000 per month. The accounts payable balance on March 31 totals $176,000, which will be paid in April. All units are sold on account for $17 each. Cash collections from sales are budgeted at 50% in the month of sale, 40% in the month following the month of sale, and the remaining 10% in the second month following the month of sale. Accounts receivable on April 1 totaled $455,000 ($95,000 from February's sales and $360,000 from March's sales). Required: a. Prepare a schedule for each month showing budgeted cash disbursements for Tilson Corporation. b. Prepare a schedule for each month showing budgeted cash receipts for Tilson Corporation. Required A Required B Prepare a schedule for each month showing budgeted cash disbursements for Tilson Corporation. April May June Production cost Cash disbursements: Production costs this month (50%) Production costs prior month (50%) Selling and administrative Total disbursements 0 $ 0 0 Required A Required B Prepare a schedule for each month showing budgeted cash receipts for Tilson Corporation. April May June Total sales Cash receipts: February sales March sales April sales May sales June sales Total receipts $ 0 $ 0 $ 0
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