GMG Power Corporation

Balance Sheet as of December 31, 2021

ASSETS
Current assets:
Cash 500,000
Accounts receivable 1,800,000
Inventories 400,000
Total current assets 2,700,000
Plant and equipment
Land 1,696,000
Buildings and equipment 14,000,000
Accumulated depreciation (5,840,000)
Plant and equipment, net 9,856,000
Total assets 12,556,000

LIABILITIES and SHAREHOLDER'S EQUITY

Current liabilities
Accounts payable 266,880
Shareholders' equity
Common shares 6,000,000
Retained earnings 6,289,120
Total shareholders' equity 12,289,120
Total liabilities and shareholders' equity 12,556,000

GMG Power Corporation

Budgeted Balance Sheet
December 31, 2022

ASSETS
Current assets:
Cash 10,637,020
Accounts receivable 5,400,000
Inventories 1,280,000
Total current assets 17,317,020
Plant and equipment
Land 1,696,000
Buildings and equipment 14,000,000
Accumulated depreciation (7,040,000)
Plant and equipment, net 8,656,000
Total assets 25,973,020

LIABILITIES and SHAREHOLDER'S EQUITY

Current liabilities
 Accounts payable 1,766,400
Shareholders' equity
Common shares 6,000,000
Retained earnings 18,206,620
Total shareholders' equity 24,206,620
Total liabilities and shareholders' equity 25,973,020

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 GMG Power Corporation
Sales Budget
For the year ending December 31, 2022

Quarter
1 2 3 4 Year
Sales Quantity (Mwh) 3,000 6,000 3,000 4,500 16,500
Sales price per Mwh 3,000 3,000 3,000 3,000 3,000
Total budgeted sales 9,000,000 18,000,000 9,000,000 13,500,000 49,500,000

Schedule of Expected Cash Collections

Accounts receivable, end 2021 1,800,000 1,800,000
First quarter sales 5,400,000 3,600,000 9,000,000
Second quarter sales 10,800,000 7,200,000 18,000,000
Third quarter sales 5,400,000 3,600,000 9,000,000
Fourth quarter sales 8,100,000 8,100,000
Total cash collections 7,200,000 14,400,000 12,600,000 11,700,000 45,900,000

GMG Power Corporation

Production Budget
For the year ending December 31, 2022

Quarter
1 2 3 4 Year
Sales Quantity(Mwh) 3,000 6,000 3,000 4,500 16,500

GMG Power Corporation

Direct Materials Purchases Budget
For the year ending December 31, 2022

Quarter
1 2 3 4 Year
Required production units 3,000 6,000 3,000 4,500 16,500

Raw materials need per unit 0.4 0.4 0.4 0.4 0.4
Production needs (MT) 1,200 2,400 1,200 1,800 6,600
Add: Desired ending inventory 480 240 360 400 400
Total Needed 1,680 2,640 1,560 2,200 7,000
Less: Beginning Inventory 125 480 240 360 125
Raw Materials to be Purchased 1,555 2,160 1,320 1,840 6,875
Cost of raw materials per MT 3200 3200 3200 3200 3200
Total Cost of Raw Materials 4,976,000 6,912,000 4,224,000 5,888,000 22,000,000
 Schedule of Expected Cash Disbursement for Raw Materials
Accounts Payable, ending 2021 266,880 266,880
First Quarter Purchases 3,483,200 1,492,800 4,976,000
Second Quarter Purchases 4,838,400 2,073,600 6,912,000
Third Quarter Purchases 2,956,800 1,267,200 4,224,000
Fourth Quarter Purchases 4,121,600 4,121,600
Total Cash Disbursements 3,750,080 6,331,200 5,030,400 5,388,800 20,500,480

GMG Power Corporation

Direct Labor Budget
For the year ending December 31, 2022

Quarter
1 2 3 4 Year

Direct Labor Cost 500,000 500,000 500,000 500,000 2,000,000

**Direct labor is in fixed amount because the company is machine-intensive in generating power.

GMG Power Corporation

Manufacturing Overhead Budget
For the year ending December 31, 2022

Quarter
1 2 3 4 Year

Sales Quantity (in Mwh) 3,000 6,000 3,000 4,500 16,500

Variable overhead rate 250 250 250 250 300
Variable manufacturing overhead 750,000 1,500,000 750,000 1,125,000 4,950,000
Fixed manufacturing overhead 400,000 400,000 400,000 400,000 1,600,000
Total manufacturing overhead 1,150,000 1,900,000 1,150,000 1,525,000 6,550,000
Depreciation (300,000) (300,000) (300,000) (300,000) (1,200,000)
Cash disbursement for manufacturin 850,000 1,600,000 850,000 1,225,000 5,350,000

GMG Power Corporation

Selling and Administrative Expense Budget
For the year ending December 31, 2022

Quarter
1 2 3 4 Year

Sales quantity 3,000 6,000 3,000 4,500 16,500

Variable and selling administrative 250 250 250 250 250
expense per Mwh
Budgeted variable expense 750,000 1,500,000 750,000 1,125,000 4,125,000
Budgeted fixed selling and administra 10,000 10,000 10,000 10,000 40,000
Salaries 100,000 100,000 100,000 100,000 400,000
Insurance 20,000 20,000 20,000 20,000 80,000
Property Taxes 10,000 10,000 10,000 10,000 40,000
Repairs and Maintenance 20,000 20,000 20,000 20,000 80,000
Total budgeted fixed selling and 160,000 160,000 160,000 160,000 640,000
administrative expenses
Total budgeted selling and 910,000 1,660,000 910,000 1,285,000 4,765,000
administrative expense

Insurance expense (20,000) (20,000) (20,000) (20,000) (80,000)

Insurance premium payment 80,000 80,000
Property tax expense (10,000) (10,000) (10,000) (10,000) (40,000)
Property tax paid 40,000 40,000

Cash disbursement for selling and 860,000 1,690,000 940,000 1,275,000 4,765,000
administrative expense
 GMG Power Corporation
Cash Budget
For the year ending December 31, 2022

Quarter
1 2 3
Cash balance, beginning 500,000 1,089,920 3,803,720
Collection from sales 7,200,000 14,400,000 12,600,000
Total cash available 7,700,000 15,489,920 16,403,720
Less disbursements:
Direct Materials 3,750,080 6,331,200 5,030,400
Direct Labor 500,000 500,000 500,000
Manufacturing overhead 850,000 1,600,000 850,000
Selling and administrative 860,000 1,690,000 940,000
Income taxes 650,000 1,565,000 650,000
Total disbursements 6,610,080 11,686,200 7,970,400

Cash balance, ending 1,089,920 3,803,720 8,433,320

GMG Power Corporation

Budgeted Income Statement
For the year ending December 31, 2022

Quarter
1 2 3

Sales 9,000,000 18,000,000 9,000,000

Cost of Goods sold 5,490,000 10,080,000 5,490,000
Direct Materials 3,840,000 7,680,000 3,840,000
Direct Labor 500,000 500,000 500,000
Manufacturing Overhead 1,150,000 1,900,000 1,150,000

Gross Margin 3,510,000 7,920,000 3,510,000

Selling and administrative expense 910,000 1,660,000 910,000

Operating Income 2,600,000 6,260,000 2,600,000
Income taxes 650,000 1,565,000 650,000
Net income 1,950,000 4,695,000 1,950,000
2022

4 Year
8,433,320 500,000
11,700,000 45,900,000
20,133,320 46,400,000

5,388,800 20,500,480
500,000 2,000,000
1,225,000 4,525,000
1,275,000 4,765,000
1,107,500 3,972,500
9,496,300 35,762,980

10,637,020 10,637,020

2022

4 Year

13,500,000 49,500,000
7,785,000 28,845,000
5,760,000 21,120,000
500,000 2,000,000
1,525,000 5,725,000

5,715,000 20,655,000

1,285,000 4,765,000
4,430,000 15,890,000
1,107,500 3,972,500
3,322,500 11,917,500