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Chapter 6 Lecture Notes Excel

# Chapter 6 Lecture Notes Excel - Exhibit 6-3 Budgeted Income...

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Exhibit 6-3 Page 1 Budgeted Income Statement for Stylistic Furniture For the Year Ending December 31, 2010 Revenues Schedule 1 \$38,000,000 Cost of goods sold Schedule 7 24,440,000 Gross margin 13,560,000 Operating costs Product design costs Schedule 8 \$1,024,000 Marketing costs Schedule 8 3,800,000 Distribution costs Schedule 8 3,876,000 8,700,000 Operating income \$4,860,000

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Schedule 1: Revenues Budget For the Year Ending December 31, 2010 Units Selling Price Total Revenues Casual 50,000 \$600 \$30,000,000 Deluxe 10,000 800 8,000,000 Total \$38,000,000 On Page 189. We use this schedule to get total revenues for our income statement. It also t
tells us the units that we are projected to sell.

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Schedule 7: Cost of Goods Sold Budget For the Year Ending December 31, 2010 From Schedule Total Beginning finished goods inventory, \$646,000 January 1, 2010 Given* Direct materials used 3A \$10,280,000 Direct manufacturing labor 4 6,000,000 Manufacturing overhead 5 12,000,000 Cost of goods manufactured 28,280,000 Cost of goods available for sale 28,926,000 Deduct ending finished goods inventory, December 31, 2010 6B 4,486,000 Cost of Goods Sold \$24,440,000 *Given in the description of basic data and requirements (Casual, \$384,000, Deluxe \$262,000). The idea is to have low amounts of invesntory so you don’t have a lot of dollar amount all ti For tyhis problem, we start out with what are the budgeted units for sales? Then we add finished goods ending inventory: Required units Subtract Finished goods beginning inventory Produced This is all FINISHED GOODS Now, we need to relate what materials we need to make 60,000 and 10,000 tables. SO we are still suing these units to come up with what our mnaterial usage is. Materials Required Plus: ending Inventory Required Subtract Beginning Balance Purchase Cost per
ied up. C D 50,000 10,000 11,000 500 61,000 10,500 1,000 500 60,000 10,000 OAK 60,000 x 12 b.f. Granites 60,000 x 6 sq ft. Labor 60,000 x 4 DLH(hours) Total 840,000 720,000 bf 120,000 80,000 920,000 70,000 850,000 \$7 per B.f. 5, 950,000

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Schedule 8: Nonmanufacturing Costs Budget For the Year Ending December 31, 2010 Business Function Variable Costs Fixed Costs Total Costs Product Design \$1,024,000 \$1,024,000 Marketing (Variable cost: \$38,000,000 × 0.065) \$2,470,000 1,330,000 3,800,000 Distribution (Variable cost: \$2 × 1,140,000 cu. ft.) 2,280,000 1,596,000 3,876,000 \$4,750,000 \$3,950,000 \$8,700,000
Exhibit 6-4 Page 7 Key Assumptions Units Sold Selling Price Casual Deluxe Casual Deluxe Red Oak Granite Dollars Master budget 50,000 10,000 \$600 \$800 \$7.00 \$10.00 \$4,860,000 Scenario 1 50,000 10,000 582 776 \$7.00 \$10.00 3,794,100 Scenario 2 50,000 10,000 600 800 \$7.35 \$10.50 4,483,800 Direct Material Cost Bu Opera What-If Scenario

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Exhibit 6-4 Page 8 22% decrease 8% decrease udgeted ating Income Change from Master Budget
Exhibit 6-5 Page 9 Decemeber 31, 2009 Assets Current Assets Cash \$300,000 Accounts receivable 1,711,000 Direct materials inventory 1,090,000 Finished goods inventory 646,000 \$3,747,000 Property, plant, and equipment: Land 2,000,000 Building and equipment \$22,000,000 Accumulated depreciation (6,900,000) 15,100,000 17,100,000 Total \$20,847,000 Liabilities and Stockholders' Equity Current Liabilities Accounts payable \$904,000 Income taxes payable 325,000 \$1,229,000 Stockholders' equity Common stock, no-par, 25,000 shares outstanding 3,500,000 Retained earnings 16,118,000 19,618,000 Total \$20,847,000 Stylistic Furniture Balance Sheet

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Stylistic Furniture Cash Budget For Year Ending December 31, 2010 Quar 1 2 Cash balance, beginning \$300,000 \$350,715 Add receipts Collections from customers 9,136,600 10,122,000 Total cash available for needs (x) 9,436,600 10,472,715 Deduct disbursements Direct materials 2,947,605 2,714,612
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Chapter 6 Lecture Notes Excel - Exhibit 6-3 Budgeted Income...

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