ZIGBY MANUFACTURING Balance Sheet March 31 Assets Liabilities and Equity Cash $ 65,666 Liabilities Accounts receivable 399,666 Accounts payable $ 264,566 Raw materials inventory 96,266 Loan payable 27,666 Finished goods inventory 368,628 Longster'm note payable 566,666 $ 731,566 Equipment $ 636,666 Equity Less: Accumulated depreciation 165,666 465,666 Common stock 356,666 Retained earnings 245,723 595,728 Total assets $ 1:327,228 Total liabilities and equity $ 1J3271228 To prepare a master budget for April, May, and June, management gathers the following information. a. Sales for March total 22,800 units. Budgeted sales in units follow: April, 22.800; May, 16,000; June. 23,000; and July. 22,800. The products selling price is $25.00 per unit and its total product cost is $19.30 per unit. b. Raw materials inventory consists solely of direct materials that cost $20 per pound. Company policy calls for a given month's ending materials inventory to equal 50% ofthe next month's direct materials requirements. The March 31 raw materials inventory is 4.510 pounds. The budgeted June 30 ending raw materials inventory is 5,500 pounds. Each nished unit requires 0.50 pound of direct materials. 1:. Company policy calls for a given months ending finished goods inventory to equal 70% of the next month's budgeted unit sales. The March 31 finished goods inventory is 15,960 units. d. Each finished unit requires 0.50 hour of direct labor at a rate of $1i per hour. e. The predetermined variable overhead rate is $4.20 per direct labor hour. Depreciation of $35,020 per month is the only fixed factory overhead item. f. Sales commissions of109 of sales are paid in the month ofthe sales. The sales manager's monthly salary is $4500. 9. Monthly general and administrative expenses include $27,000 for administrative salaries and 0.6% monthly interest on the long term note payable. h. The company budgets 30% of sales to be for cash and the remaining 70% on credit. Credit sales are collected in full in the month following the sale (no credit sales are collected in the month of sale). i. All raw materials purchases are on credit, and accounts payable are solely tied to raw materials purchases. Raw materials i. All raw materials purchases are on credit, and accounts payable are solely tied to raw materials purchases. Raw materials purchases are fully paid in the next month (none are paid in the month of purchase). j. The minimum ending cash balance for all months is $65,000. If necessary. the company borrows enough cash using a loan to reach the minimum. Loans require an interest payment ofl% at each monthend (before any repayment). lfthe monthend preliminary cash balance exceeds the minimum the excess will be used to repay any loans. k. Dividends of $25,000 are budgeted to be declared and paid in May. I. No cash payments for income taxes are budgeted in the second calendar quarter. Income tax will be assessed at 35% in the quarter and budgeted to be paid in the third calendar quarter. m. Equipment purchases of $100000 are budgeted for the last day of June. Required: Prepare the following budgets for the months of April, May, and June: 1. Sales budget. 2. Production budget. 3. Direct materials budget. 4. Direct labor budget. 5. Factory overhead budget. 6. Selling expense budget. 7. General and administrative expense budget. 8. Schedule of cash receipts. 9. Schedule of cash payments for direct materials. 10. Cash budget. 11. Budgeted income statement for entire second quarter [not monthly). 12. Budgeted balance sheet at June 30. Reg 1 Reg 2 Req 3 Reg 4 Req 5 Reg 6 Req ? Req 8 to 10 Reg 11 Req 12 8. Schedule of cash receipts. 9. Schedule of cash payments for direct materials. 10. Cash budget. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign.) Show lessA Sales $ 570,000 $ 400,000 $ 575,000 Cash receipts from Cash sales Collections of prior period sales Total cash receipts $ 0 $ 0 $ 0 Materials purchases 3% 194,700 $ 213,800 $ 224,300 Cash payments for Currentperiod purchases $ 519,000| $ 452,500|_ $ 0 Total cash payments 3% 519,000 $ 452,500 Req 1 Req 2 Req 3 Req 4 Req 5 Reg 6 Req 7 Req 8 to 10 Req 11 Req 12 Budgeted income statement for entire second quarter (not monthly). (Round your final answers to the nearest whole dollar.) ZIGBY MANUFACTURING Budgeted Income Statement For Three Months Ended June 30 Selling, general and administrative expenses Total operating expenses 0 0 $ 0ZIGBY MANUFACTURING Budgeted Balance Sheet June 30 Assets 0 Total assets Liabilities and Equity Liabilities Equity Total Liabilities and Equity