Question

SB Problem PA8-1 to PAB-3 The following information applies to the questions played below Iguanane, manufactures bamboo picture frames that sell for $20 each Each averages $13 per hour Iguana has the following inventory policies me requires 4 linear feet of bamboo which costs $150 per foot Each trametas o mately 30 minutes to build and the laborate • Ending finished goods inventory should be 40 percent of next month's sales • Ending raw materials inventory should be 30 percent of next month's production Expected unnt sales frames for the upcoming months follow Varia a cturing overheads incurred a n produced an d manufacturing overhead is estimated to be 57.2008600 ne x pected production of 6.000 units for the year Selling and w e expenses are mandato per month $0.50 per un sold Iguana, Inc. had $15.000 cash on and on Art Of percent is inch of the credit sales, 50 percent is collected during the month of these and so percentis collected during the month following me Oraw materia che s i p o ng the month purchased and 20 percent is paid the flowing mo w material purchases for March 2000 Alther operating costs are paid during the more on M e d 5.290 i depresion. During April plans to pay $1.000 force of e en

Answer 1

Please give positive ratings so I can keep answering. It would help me a lot. Please comment if you have any query. Thanks!

Iguana
Sales Budget	March	April	May	June	2nd Qtr. Total	July	August	Note
Budgeted Sales units	345.00	390.00	440.00	540.00		515.00	565.00	A
Sell price per unit	20.00	20.00	20.00	20.00		20.00	20.00	B
Budgeted Sales Revenue	6,900.00	7,800.00	8,800.00	10,800.00	27,400.00	10,300.00	11,300.00	C=A*B
Cash sale is 80%	5,520.00	6,240.00	7,040.00	8,640.00	21,920.00			D=C*80%
Credit sale is 20%	1,380.00	1,560.00	1,760.00	2,160.00	5,480.00			E=C*20%

Answer 1
Budgeted cash receipts		April	May	June	2nd Qtr. Total
Cash sale		6,240.00	7,040.00	8,640.00	21,920.00
50% of Credit sale in the same month		780.00	880.00	1,080.00	2,740.00
50% of Credit sale in the following same month		690.00	780.00	880.00	2,350.00
Budgeted cash receipts		7,710.00	8,700.00	10,600.00	27,010.00

Budgeted Production in Units	March	April	May	June	2nd Qtr. Total	July	August
Budgeted Sales units	345.00	390.00	440.00	540.00		515.00	565.00
Add: Closing	156.00	176.00	216.00	206.00		226.00
Less: Opening	138.00	156.00	176.00	216.00		206.00
Budgeted Production in Units	363.00	410.00	480.00	530.00		535.00

Budgeted cost of Raw Material Purchases	March	April	May	June	2nd Qtr. Total	July
Production Budget		410.00	480.00	530.00		535.00
Bamboo required per unit		4.00	4.00	4.00		4.00
Bamboo required		1,640.00	1,920.00	2,120.00		2,140.00
Add: Closing		576.00	636.00	642.00
Less: Opening		492.00	576.00	636.00
Budgeted Raw Material Purchases		1,724.00	1,980.00	2,126.00
Cost per foot		1.50	1.50	1.50
Budgeted cost of Raw Material Purchases	3,000.00	2,586.00	2,970.00	3,189.00
80% paid in same month		2,068.80	2,376.00	2,551.20	6,996.00
20% paid in next month		600.00	517.20	594.00	1,711.20
Direct Material Payment		2,668.80	2,893.20	3,145.20	8,707.20

Budgeted Direct Labor cost	April	May	June	2nd Qtr. Total
Production Budget	410.00	480.00	530.00
Labor Hour required per unit	0.50	0.50	0.50
Total Labor Hour required	205.00	240.00	265.00
Labor Rate per Hour	13.00	13.00	13.00
Budgeted Direct Labor cost	2,665.00	3,120.00	3,445.00	9,230.00
Budgeted manufacturing overhead	April	May	June	2nd Qtr. Total
Production Budget	410.00	480.00	530.00
Variable manufacturing overhead per unit	0.30	0.30	0.30
Variable manufacturing overhead Budget	123.00	144.00	159.00	426.00
Fixed manufacturing overhead Budget	600.00	600.00	600.00	1,800.00
Budgeted manufacturing overhead	723.00	744.00	759.00	2,226.00
Total Selling & admin expenses Budget	April	May	June	2nd Qtr. Total
Budgeted Sales units	390.00	440.00	540.00
Variable Selling & admin expenses per unit	0.50	0.50	0.50
Variable Selling & admin expenses Budget	195.00	220.00	270.00	685.00
Fixed Selling & admin expenses Budget	650.00	650.00	650.00	1,950.00
Total Selling & admin expenses Budget	845.00	870.00	920.00	2,635.00
Answer 2
Budget cash payments	April	May	June	2nd Qtr. Total
Direct Material	2,668.80	2,893.20	3,145.20	8,707.20
Direct Labor	2,665.00	3,120.00	3,445.00	9,230.00
Manufacturing Overhead (excl. depreciation)	433.00	454.00	469.00	1,356.00
Selling & admin expenses	845.00	870.00	920.00	2,635.00
Payment for equipment	3,000.00	-	-	3,000.00
Budget cash payments	9,611.80	7,337.20	7,979.20	24,928.20
Answer 3
Cash budget	April	May	June	2nd Qtr. Total
Beginning Cash Balance	15,800.00	15,898.20	15,261.00
Plus: Budgeted cash receipts	7,710.00	8,700.00	10,600.00	27,010.00
Less: Budget cash payments	9,611.80	7,337.20	7,979.20	24,928.20
Preliminary cash balance	13,898.20	17,261.00	17,881.80
Cash borrowed/ (repaid)	2,000.00	(2,000.00)	-	-
Ending cash balance	15,898.20	15,261.00	17,881.80