X company manufactures cell phones. the information is given below:
Input Data Revenue Assumption Selling Price per Cell Phone S 150.00 Volume of Cell Phone Sales 100,000.00 Total Sales $ 15,000,000.00 Direct Materials per Cell Phone Circuit 35.00 Battery 20.00 Case 10.00 Direct Labour Hours Assembly 0.50 Packing 0.10 Cost Per Hour Assembly 65.00 Packing 35.00 Cost Per Cell Phone Assembly 30.00 Packing 5.00Inventory Information Beginning Ending Circuit 25,000.00 $ 35,000.00 Battery 20,000.00 $ 25,000.00 Case 10,000.00 $ 12,000.00 Finished Goods (Units) 2,000.00 2200.00 Cost Per Unit 128.15 Total $ 281,930.00 Finished Goods (Costs) $ 107,850.00 Tax Rate 25%Estimated Variable Manufacturing Overhead Costs: Supplies 220,000.00 Indirect Labour 300,650.00 Maintenance 140,200.00 Miscellaneous 55,200.00 Total 716,050.00 Variable Overhead Allocation Rate 7.15 Estimated Fixed Manufacturing Overhead Costs: Amortization 320,728.00 Property Taxes 32,228.00 Insurance 72,368.00 Plant Management 340,600.00 Fringe Benefits 406,840.00 Miscellaneous 89,992.00 Total 1,262,756.00 Fixed Overhead Allocation Rate 21.00 Support Department Fixed Costs Administration 1,534,800.00 Marketing 1,020,748.00 Distribution 510,374.00 Customer Service 303,458.00 Total 3,369,380.00Refer to the information above. A company's managers budget cash flows on a quartey basis so that they can plan short-tenn investments and borrowings. Cellular phone sales are highest during the spring and summer. Sales are fairly even within each quarter, but sales vary across quarters as follows: Jul -Se- ember 30% October-December 10% Accounts receivable at the end of the prior year, consisting of sales made during December totalled $130,000. Payments from customers are usually received as follows: Pa durin_ the month oods are received 50% Pa the next month Bad Debts The company pays its vendors 10 days after raw materials are received, so approximately 00% of purchases are paid in the month of production and 20% are paid the following month. Accounts payable at the end of the prior year totalled $130,000, Employee wages and other production costs are paid during the month incurred. Property taxes are paid in two equal installments on March 31 and September 30, and insurance is paid annually on June 30. Support costs are paid evenly throughout the year. Estimated income tax payments are made at the end of the Quarter ! based on 25% of total estimated taxes for the year. In addition to customer receipts, the company expects to receive $10,000 in proceeds from the sale of equipment during January. The company also plans to purchase and pay for new equipment costing $100,000 in January. The company nances its short-term operations with a line of credit from the bank which had a balance of $500,000 at the end of the prior year. The line of credit requires quarterly interest rates payments at an annual rate of 5.5%. {For simplicity, assume that al borrowing and repayments occur on the last day of each quarter) Question: Prepare quarterly budgets for cash receipts, cash disbursements and short- term nancing
