__Accounting Budget (complete).xls - Exercise 8-1 p364...

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Exercise 8-1, p364:Schedule of Expected Cash CollectionsGiven:Peak sales for Midwest Products, a wholesale distributor of leaf rakes, occur in August. Thecompany's sales budget for the third quarter showing these peak sales is given below:MayJuneJulyAugustSeptemberTotalBudgeted Sales (All on Account)$600,000 $900,000 $500,000 $2,000,000 Actual Sales (All on Account)$430,000 $540,000 Total Sales$430,000 $540,000 $600,000 $900,000 $500,000 $2,970,000 From past experience, the company has learned that 20% of a month's sales are collected in themonth of sale, another 70% are collected in the month following the sale, and the remaining 10% arecollected in the second month following the sale. Bad debts are negligible and can be ignored.Required:1. Prepare a schedule of expected cash collections from sales, by month and in total, for the thirdquarter.
2.Assume that the company will prepare a budgeted balance sheet as of September 30. Computethe A/R as of that date.
Exercise 8-2, p 364:Production BudgetGiven:Crystal telecom has budgeted the sales of its innovative mobile phone over the next four months asfollows:UnitSalesJuly30,000August45,000September60,000October50,000The company is now in the process of preparing a production budget for the third quarter. PastRequired:Prepare a production budget for the third quarter showing the number of units to be produced eachmonth and for the quarter in total.**EI is anticipated to be 10% of the next month's salesexperience has shown that end-of-month inventories of finished goods must equal 10% of the nextmonth's sales. The inventory at the end of June was 3,000JulyAugustSeptemberQuarterOctoberBudgeted Sales30,000 45,000 60,000 135,000 50,000 Desired EI**4,500 6,000 5,000 5,000 Total Units Desired34,500 51,000 65,000 140,000 Less BI3,000 4,500 6,000 3,000 Production31,500 46,500 59,000 137,000 137,000 .
Exercise 8-3, p 365: Direct Materials BudgetGiven:production budget for the calculator by quarters for Year 2 and for the first quarter of Year 3, as shown below:1st Quarter Y22nd Quarter Y23rd Quarter Y24th Quarter Y21st Quarter Y3Budgeted Production (Calculators)60,00090,000150,000100,00080,000The chip used in production of the calculator is sometimes hard to get, so it is necessary to carry large inventories as aRequired:Prepare a direct materials budget for chips, by quarter and in total, for Year 2. At the bottom of your budget,show the dollar amount of purchases for each quarter and for the year in total.1st Quarter Y22nd Quarter Y23rd Quarter Y24th Quarter Y2Year 2Budgeted Production (Calculators)60,00090,000150,000100,000400,000# of chips needed per calculator33333Total chips needed for production180,000270,000450,000300,0001,200,000Desired EI **54,00090,00060,00048,00048,000Total direct materials needed234,000360,000510,000348,0001,248,000Less: BI of chips36,00054,00090,00060,00036,000Required purchases of chips (units)198,000306,000420,000288,0001,212,000Cost per chip$2 $2 $2 $2 $2 Required purchases of chips (dollars)

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