Question

Problem 20-4A Manufacturing: Preparation of a complete master budget LO P1, P2, P3 The management of Zigby Manufacturing prepared the following estimated balance sheet for March 2017: 00 points Skipped eBook Print ZIGBY MANUFACTURING Estimated Balance Sheet March 31, 2017 Assets Cash 43,000 Accounts receivable 432,900 Raw materials inventory 86, 198 Finished goods inventory 387,168 Total current assets 949, 266 Equipment, gross 606,000 Accumulated depreciation (153,000) Equipment, net 453,000 Total assets $1,402,266 Liabilities and Equity Accounts payable $ 194,798 Short-term notes payable 15,000 Total current liabilities 209,798 Long-term note payable 500,000 Total liabilities 709,798 Common stock 338,000 Retained earnings 354,468 Total stockholders' equity 692,468 Total liabilities and equity $1,402,266

Answer 1

Solution 1:

ZIGBY MANUFACTURING
Sales Budget
April, May, and June 2017
	Budgeted Unit Sales	Budgeted Unit Price	Budgeted Sales Dollars
Apr-17	22200	$26.00	$577,200.00
May-17	16000	$26.00	$416,000.00
Jun-17	19800	$26.00	$514,800.00
Totals for the second quarter	58000	$26.00	$1,508,000.00

Solution 2:

ZIGBY MANUFACTURING
Production Budget
April, May, and June 2017
	April	May	June
Next month's budgeted sales (units)	16000	19800	22200
Ratio of inventory to future sales	80%	80%	80%
Desired ending inventory	12800	15840	17760
Budgeted sales units	22200	16000	19800
Required units of available production	35000	31840	37560
Beginning inventory	17760	12800	15840
Units to be produced	17240	19040	21720

Solution 3:

ZIGBY MANUFACTURING
Raw Materials Budget
April, May, and June 2017
	April	May	June
Production budget (units)	17240	19040	21720
Raw material per unit	0.5	0.5	0.5
Materials needed for production	8620	9520	10860
Desired ending inventory	4760	5430	4300
Total materials requirements (units)	13380	14950	15160
Beginning inventory	4310	4760	5430
Materials to be purchased	9070	10190	9730
Material price per unit	$20.00	$20.00	$20.00
Budgeted raw material purchases	$181,400.00	$203,800.00	$194,600.00

Solution 4:

ZIGBY MANUFACTURING
Direct Labor Budget
April, May, and June 2017
	April	May	June	Total
Budgeted production (units)	17240	19040	21720	58000
Direct labor hour per unit	0.5	0.5	0.5	0.5
Total labor hours needed	8620	9520	10860	29000
Direct labor rate per hour	$18.00	$18.00	$18.00	$18.00
Budgeted direct labor cost	$155,160.00	$171,360.00	$195,480.00	$522,000.00

Solution 5:

ZIGBY MANUFACTURING
Factory overhead Budget
April, May, and June 2017
	April	May	June	Total
Labor hours needed	8620	9520	10860	29000
Variable overhead rate per hour	$3.00	$3.00	$3.00	$3.00
Budgeted variable overhead	$25,860.00	$28,560.00	$32,580.00	$87,000.00
Budgeted fixed overhead	$25,134.00	$25,134.00	$25,134.00	$75,402.00
Budgeted total overhead	$50,994.00	$53,694.00	$57,714.00	$162,402.00

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