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Waterways Corporation is preparing its budget for the coming year, 2 0 2 2 . The first step is to plan for the first quarter
Waterways Corporation is preparing its budget for the coming year, The first step is to plan for the first quarter of that coming year. The company has gathered information from its managers in preparation of the budgeting process. Sales Unit sales for November Unit sales for December Expected unit sales for January Expected unit sales for February Expected unit sales for March Expected unit sales for April Expected unit sales for May Unit selling price $ Waterways likes to keep of the next month's unit sales in ending inventory. All sales are on account. of the Accounts Receivable are collected in the month of sale, and of the Accounts Receivable are collected in the month after sale. Accounts receivable on December totaled $ Direct Materials Direct materials cost cents per pound. Two pounds of direct materials are required to produce each unit. Waterways likes to keep of the materials needed for the next month in its ending inventory. Raw Materials on December totaled pounds. Payment for materials is made within days. is paid in the month of purchase, and is paid in the month after purchase. Accounts Payable on December totaled $ Direct Labor Labor requires minutes per unit for completion and is paid at a rate of $ per hour. Manufacturing Overhead Indirect materials per labor hour Indirect labor per labor hour Utilities per labor hour Maintenance per labor hour Salaries $ per month Depreciation $ per month Property taxes $ per month Insurance $ per month Maintenance $ per month
Selling and Administrative Variable selling and administrative cost per unit is $ Advertising Insurance Salaries Depreciation $ a month $ a month $ a month $ a month Other fixed costs $ a month Other Information The Cash balance on December totaled $ but management has decided it would like to maintain a cash balance of at least $ beginning on January Dividends are paid each month at the rate of $ per share for shares outstanding. The company has an open line of credit with Romney's Bank. The terms of the agreement requires borrowing to be in $ increments at interest. Waterways borrows on the first day of the month and repays on the last day of the month. A $ equipment purchase is planned for February.
For the first quarter of prepare a manufacturing overhead budget. Round overhead rate to decimal places, eg and all other answers to decimal places, eg List Variable Costs first.
Manufacturing Overhead Budget
For the First Quarter of
First Quarter
Variable Costs
tableIndirect MaterialsUtilities
$ February
N
January
$
$
tableJanuary$
Total Variable Costs
Fixed Costs
tableSalaries
Property Taxes
Insurance
Total Manufacturing Overhead
Predetermined overhead rate for the quarter
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