Question

(c) Calculate the productiion cost per umt anae (Round to two decimals.) (d) Which plan should be accepted? (Hint: Calculate the gross profit under each plan.) Nigh Corporation prepares monthly cash budgets. Relevant data from operating budgets for 2017 Prepare cash budget. P21-3A follow (LO 4) AP February January Sales Direct materials purchases Direct labour $400,000 130,000 100,000 75,000 81,000 $350,000 120,000 80,000 70,000 79,000 Manufacturing overhead Selling and administrative expenses

Answer 1

Expected Collections from Customers January February November $ 52,000 December $ 90,000 $ 60,000 January $ 175,000 $ 105,000 February $ 200,000 Total Collections $ 317,000 $ 365,000 February Expected Collections from Customers January $ 40,000 $ 72,000 December January February Total Payments $ $ $ 48,000 78,000 126,000 $ 112,000

$ Nigh Corporation Cash Budget For the Two Months Ending Febraury 28, 2017 January February Beginning Cash Balance $ 60,000 $ 51,000 Add: Receipts Collections from Customers $ 317,000 $ 365,000 Notes Receivables $ 15,000 $ Sales of Securities $ 6,000 Total Receipts $ 332,000 $ 371,000 Total Available Cash 392,000 $ 422,000 Less: Disbursements Direct Materials 112,000 $ 126,000 Direct Labor 80,000 $ 100,000 Manufacturing Overhead 70,000 $ 75,000 Selling and Administrative Expenses $ 79,000 $ 81,000 Cash Dividends - $ 5,000 Total Disbursements $ 341,000$ 387,000 Excess (deficiency) of Available Cash $ 51,000 $ 35,000 over Cash Disbursements Financing Add: Borrowing $ 15,000 Less: Repayments Ending Cash Balance 51,000 $ 50,000