P9-60 B

COMPREHENSIVE BUDGETING PROBLEM

CHAPTER 9 PAGE 561
Req. 1

CASH SALES (35%)

CREDIT SALES 65%)
Total collections

CASH COLLECTIONS
January
February
March
$34,860
$41,580 $40,320
$46,150
$64,740 $77,220
$81,010
$106,320 $117,540

Quarter
$116,760
$188,110
$304,870

Req.2

UNIT SALES
Plus:Desired ending inventory
TOTAL NEEDED
LESS:BEG. Inventory
Units to produce

PRODUCTION BUDGET
JANUARY FEBRUARY MARCH
QUARTER
8,300
9,900
9,600
27,800
990
960
900
900
9,290
10,860
10,500
28,700
-830
-990
-960
-830
8,460
9,870
9,540
27,870

Req. 3
DIRECT MATERIALS BUDGET

UNITS TO BE PRODUCED
MULTIPLY BY:Quantity of DM neede

quantity of dm needed for producti

plus:Desired ending inventory of D

total quanity of dm needed

less beggininng inventory of dm
quantity of dm to purchase
multiply by: Cost per pound
Total Cost of DM purchase

JANUARY FEBRUARY MARCH

QUARTER
8,460
9,870
9,540
27,870
x3.0
x3.0
x3.0
x3.0
25,380
29,610
28,620
83,610
5,922
5,724
5,376
5,376
31,302
35,334
33,996
88,986
-5,076
-5,922
-5,724
-5,076
26,226
29,412
28,272
83,910
x2.00
x$2.00
x$2.00
x$2.00
$52,452
$58,824 $56,544 $167,820

Req.4

DECEMBER PURCHASES
JANUARY PURCHASES
FEBRUARY PURCHASES
MARCH PURCHASES
TOTAL PAYMENTS

CASH PAYMENTS FOR DIRECT MATERIAL PURCHASES BUDGET

JANUARY FEBRUARY MARCH
QUARTER
$43,000
$43,000
$10,490
$41,962
$52,452
$11,765 $47,059 $58,824
$11,309 $11,309
$53,490
$53,727 $58,368 $165,585

Req.5
CASH PAYMENTS FOR DIRECT LABOR BUDGET

DIRECT LABOR

JANUARY FEBRUARY MARCH

QUARTER
$3,807
$4,442
$4,293 $12,542

Req. 6
CASH PAYMENTS FOR MANUFACTURING OVERHEAD COSTS

RENT (FIXED)
Other MOH (fixed)
Variable manufacturing overhead c

TOTAL DISBURSMENTS

JANUARY FEBRUARY MARCH

QUARTER
$5,500
$5,500
$5,500 $16,500
$2,900
$2,900
$2,900
8,700
$9,306
$10,857 $10,494 $30,657
$17,706
$19,257 $18,894 $55,857

Req. 7
CASH PAYMENTS FOR OPERATING EXPENSES

VARIABLE OPERATING EXPENSES

FIXED OPERATING EXPENSES
TOTAL DISBURSMENTS

JANUARY FEBRUARY MARCH

QUARTER
$10,375
$12,375 $12,000 $34,750
$1,800
$1,800
$1,800
$5,400
$12,175
$14,175 $13,800 $40,150

Req.8

Cash balance,beginning
Pluse:cash collections(req.1)
Total cash available
Less cash disbursments:
DM purchases (req 4)
DL costs (req 5)
MOH costs (req 6)
Operating expesnes (req 7)
Tax payment
Equipment purchases
Total cash payments
Ending cash before financing
Financing:
Borrowings:
Repayments
Interest

Combined Cash Budget

JANUARY FEBRUARY MARCH
QUARTER
$4,600
$4,432
$4,951
$4,600
$81,010
106,320 $117,540 $304,870
$85,610
110,752 $122,491 $309,470
53,490
3,807
17,706
12,175
5,000
92,178
-6,568
11,000
-

53,727
58,368
4,442
4,293
19,257
18,894
14,175
13,800
10,000 12,200
16,600
113,801 111,955
-3,049
10,536
8,000
-

-6000
-490

165,585
12,542
55,857
40,150
10,000
33,800
317,934
-8,464
19,000
-6000
-490

Total Financing
Cash balance, ending

11,000
$4,432

8,000
$4,951

-6,490
$4,046

-6,490
$4,046

Req 9
BUDGET MANUFACTURING COST PER UNIT
DM COST PER UNIT
DL COST PER UNIT
VMOH COSTS
FIXED MOH
COST OF MANUFACTURING EACH UN

$6.00
0.45
1.1
0.7
$8.25

Req 10

PRESIDIO
MANUFACTURING
BUDGETED INCOME STATEMENT
FOR THE QUARTER END MARCH 31

SALES
Less: Cost of goods sold
Gross profit
Less:Operaiting expenses
Less:Depreciation expenses
Operating income
Less:interest expense
Less: income tax expense
Net Income

$333,600
229,350
104,250
40,150
4,600
59,500
490
17,703
$41,307

ASES BUDGET

EAD COSTS