Question

Tyler Corp has the following budgeted sales for the first 4 moeths of next year Маrch $50,000 $145,000 $195,000 April $45,000 $130,000 $175,000 February S60,000 January $80,000 $350,000 $430,000 Cash sales Credit sales Total sales $200,000 $260,000 The Company is in the process of preparing a cash budget and must determine the expected cash collections. Accordingly, the following information has been assembled: Collections on credit sales Month of sale Month after sale 2nd month after sale 60% 30% 10% $155,000 The accounts receivable balance on January 1 is Of this amount, $132,000 represents uncollected December sales and $23,000 represents uncollected November sales 14 The total cash collected in January would be: $412,000 A. $445,000 $389,000 $346,000 E. None of the above В. С. D. 15 Hayes Corporation uses machine hours (MHs) as its denominator activity for fixed manufacturing overhead (FMOH). For the most recent year, the company showed the following data. 280,000 S S Actual FMOН соst 39,000 Favorable 11,000 Favorable 600,000 MHs FMOH Budget Variance FMOH Volume Variance Standard MHs allowed for actual output The budgeted MHs for Hayes was closest to: 621,429 MHs 573,810 MHs 628,696 MHs 580,000 MHs None of the above A. В. C. D. E. Page 9 of 12

Answer 1

Ans. 14	Option B $445,000
	Schedule of Cash receipt In January
		January
	Cash receipts from:
	Cash sales	$80,000
	Accounts receivable (from November & December sales)	$155,000
	From January month's credit sales ($350,000 * 60%)	$210,000
	Total budgeted cash receipts	$445,000
Ans. 15	Option D    580,000   MHs
	Fixed overhead budget variance = Budgeted fixed overhead - Actual fixed overhead
	$39,000 = Budgeted fixed overhead - $280,000
	Budgeted fixed overhead   = $280,000 + $39,000
	$319,000
	Fixed overhead volume variance = (Standard machine hours * Budgeted overhead rate) - Budgeted fixed overhead
	$11,000 = (600,000 * Budgeted overhead rate) - $319,000
	600,000 * Budgeted overhead rate = $319,000 + $11,000
	600,000 * Budgeted overhead rate = $330,000
	Budgeted overhead rate   = $330,000 / 600,000
	$0.55 per machine hour
	Budgeted machine hours = Budgeted fixed overhead / Budgeted overhead rate
	$319,000 / $0.55
	580,000 MHs