Unit Sales2017: Q1=65,000 Q2=60,000 Q3=75,000 Q4=80,000 Unit sales 2018: Q1=70,000

Quarterly dividends 2017: $300,000

Sales price=$380 Direct Labor rate $21per hour Variable S&A $8 unit sold

Unit Material Cost $65 Variable OH rate $6 per labor hour

Sales Budget 2017

Q1 Q2 Q3 Q4 Year

Sales in units

Selling price/units

=Gross Revenue

Then,

Collections of accounts recievable:

75% current quarter sales

25% current quarter sales 3,250,000

Total Cash Collections

Production Budget

Budget unit sales

Add: desired ending inventory of finished goods

Total units needed

Less: Beginning inventory 13,000

=Budgeted Production

Direct Materials Purchased

Q1 Q2 Q3 Q4 Year

Budgeted production

Raw materials needed/unit

=total needed for production

Add: desired raw materials ending inventory $36,000

Total Direct Mat. Needed

Less: begin. Inventory $28,800

Total Material purchased

Unit Material Cost

Total Direct Material Cost

Cash Disbursments for D.M

85%Current Quarter Purchases

15%Current Quarter Purchases $1,500,000

Total Cash Disburse for D.M.

Direct Labor Budget

Budgeted Production

Direct Labor hours/unit 2.5 2.5 2.5 2.5 2.5

Total Direct Hours needed

Hourly wage rate

Budgeted Direct Labor Cost

Factory Overhead Budget

Q1 Q2 Q3 Q4 Year

Budgeted Direct Labor hours:

Variable Overhead Rate per:

=Direct Labor hours

Total Var. Manuf. Overhead

Fixed Manuf. Overhead Depr.

Other Fixed overhead Expenses

Total Fixed Overhead

Total Manufacturing Overhead

Less: noncash expense(depreciation)

Cash Disbursement for Factory Overhead

Selling and Administration Budget

Budgeted Units Sold:

Variable Selling&Adminstration:

Expenses per unit

Total Var. S & A Expenses

Fixed S & A Depreciation Expens

Other Fixed S&A Expens

Total Fixed S&A Expense

Total Selling and Adm. Expense

Less: noncash expense(depreciation)

Cash Disbursement for Selling & Admin Expenses

Schedule1

Cost element Unit Cost Quantity Total

Direct Materials 3

Direct Labor 2.5 M.O.H 1

Ending Finished Goods Inventory Budget

Ending Finished Goods Inventory

Cost per unit (schedule 1)

Budgeted ending inventory

Cost of goods sold budget:

Year

Sales Volume

Cost per unit (schedule 1)

Cost of Goods Sold

Cash Budget

Q1 Q2 Q3 Q4 YEAR

Cash balance ending period $1,250,000

Collections of Cash Recievebles

Total cash available

Cash disbursment for D.M.

Cash disbursment for D.L.

Factory Overhead

Selling &Admin expenses

Income Taxes (Are Paid in 4^th Quarter)

Net Cash From Operations

Equipment Purchased $3,000,000 $3,000,000

Dividends Paid

Ending Cash Balance:

Balance Sheet

Assets:

Cash

Accounts recievable (Uncollected balance of 4^th quarter sales)

Materials inventory

Finished Goods inventory

Total assets

Liabilities& S.E. Equity

Accounts payable ((Unpaid balance of 4^th Quarter Materials)

Additional information needed:

The desired ending product inventory is 20%of the next quarters budgets sales

3 pounds of direct material is needed to produce each unit of production

The desired ending raw materials inventory is % of raw materials needed for the next quarters budgeted production

Factory overhead includes $250,000 per quarter of depreciation and $350,000 per quarter of other fixed overhead

Selling and Administration expenses include $50,000 of depreciation per quarter and $250,000 of the other fixed overhead per quarter

The tax rate is 35%