You are the cost accountant at Poseys Pet Emporium, tasked with preparing quarterly budgets that determine the cash effects of the companys sales and production-related expenditures. The company uses a calendar year, and it is time to prepare the third-quarter budget. You have the following information:

1. The budgeted selling price for the year is $4.99 per unit. Sales volumes are budgeted as follows for the last month of quarter two, for all of quarter three, and for part of quarter four.

June	July	August	September	October
33,500	32,000	35,200	35,000	34,000

1. Historically, 20% of Poseys sales are cash sales. Of the remaining credit sales, 45% are collected in the month of sale, while 52% are collected the following month. The remainder is deemed uncollectible.
2. Management sets its ending finished goods inventory goal at 15% of the following months sales volume. The accounting team expects this policy will be met at the beginning of the second quarter.
3. The target ending inventory for Poseys primary direct material is 20% of the following months production needs. Each completed unit requires five pounds of direct materials at an expected cost of $0.25 per pound. The budgeted production for October is 34,000.
4. Poseys pays for 40% of its purchases in the month of purchase and 60% the month after purchase. Total budgeted purchases in June are $20,000.
5. Poseys ending cash balance on June 30 was $57,950.
6. Poseys non-production cash disbursements are estimated at $80,000 per month.

Posey's Pet Emporium
Sales Forecast	July	August	September	Quarter
Budgeted sales volume	32000	35200	35000	102200
Budgeted selling price	[Insert formula]	[Insert formula]	[insert formula]	[Inseert formula]
Budgeted sales revenue	[Insert formula]	[insert formula]	[Insert formula]	[Insert formula]
Cash Receipts Budget	July	August	September	Quarter
Beginning A/R (June collections)	[Insert formula]			[Insert formula]
July cash sales	[Insert formula]			[Insert formula]
July credit sales	[Insert formula]	[Insert formula]		[Insert formula]
August cash sales		[Insert formula]		[Insert formula]
August credit sales		[Insert formula]	[Insert formula]	[Insert formula]
September cash sales			[Insert formula]	[Insert formula]
September credit sales			[Insert formula]	[Insert formula]
Total cash receipts	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]

Posey's Pet Emporium
Sales Forecast	July	August	September	Quarter
Budgeted sales volume	32000	35200	35000	102200
Budgeted selling price	[Insert formula]	[Insert formula]	[insert formula]	[Inseert formula]
Budgeted sales revenue	[Insert formula]	[insert formula]	[Insert formula]	[Insert formula]
Cash Receipts Budget	July	August	September	Quarter
Beginning A/R (June collections)	[Insert formula]			[Insert formula]
July cash sales	[Insert formula]			[Insert formula]
July credit sales	[Insert formula]	[Insert formula]		[Insert formula]
August cash sales		[Insert formula]		[Insert formula]
August credit sales		[Insert formula]	[Insert formula]	[Insert formula]
September cash sales			[Insert formula]	[Insert formula]
September credit sales			[Insert formula]	[Insert formula]
Total cash receipts	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]

Posey's Pet Emporium
Production Budget	July	August	September	Quarter
Budgeted sales volume	[Insert formula]	[Insert formula	[Insert formula]	[Insert formula]
Add: Target ending FG inventory	[Insert formula]	[insert formula]	[insert formula]	[insert formula]
Total units needed
Less: Beginning FG inventory	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]
Budgeted units to be produced	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]
DM Purchases Budget	July	August	September	Quarter
Budgeted units to be produced	[insert formula]	[Insert formula]	[Insert formula]	[Insert formula]
Pounds of DM per unit	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]
Total production needs (pounds)	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]
Add:Target ending DM inventory (pounds)	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]
Total DM inventory needs (pounds)	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]
Less: Beginning DM inventory (pounds)	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]
Budgeted pounds of DM to be purchased	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]
DM cost per pound	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]
Total budgeted cost of DM purchases	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]

Posey's Pet Emporium
DM Cash Disbursements	July	August	September	Quarter
A/P balance from June*	[Insert formula]			[insert value}
July purchases	[Insert formula]	[Insert formula]		[insert value}
August purchases		[Insert formula]	[Insert formula]	[insert value}
September purchases			[Insert formula]	[insert value}
Total DM Cash Disbursements	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]
Other Cash Disbursements	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]
Total Cash Disbursements	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]

Posey's Pet Emporium
Selling price	[Insert formula]
Less: Target gross margin percentage	[Insert formula]
Cost of goods sold	[Insert formula]
Less: DM cost per unit	[Insert formula]
Additional cost per unit to cover DL and MOH	[Insert formula]

Posey's Pet Emporium
Cash Budget	July	August	September	Quarter
Beginning Cash Balance	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]
Plus: Cash Receipts
Cash Sales	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]
Cash Collections	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]
Total Cash Receipts	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]
Total Cash Available	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]
Less: Cash Disbursements	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]
Ending Cash Balance	[Insert formula]	[Insert formula]	[Insert formula]	[Insert formula]