ACCT303Chapter6

# 6 9 6 27 30 min cash flow analysis chapter appendix 1

• Notes
• SargentStrawGoldfish10237
• 42
• 83% (6) 5 out of 6 people found this document helpful

This preview shows 9 out of 13 pages.

6-9

Subscribe to view the full document.

6-27 (30 min.) Cash flow analysis, chapter appendix. 1. The cash that TabComp, Inc., can expect to collect during April 2006 is calculated below. April cash receipts: April cash sales (\$400,000 .25) \$100,000 April credit card sales (\$400,000 .30 .96) 115,200 Collections on account: March (\$480,000 .45 .70) 151,200 February (\$500,000 .45 .28) 63,000 January (uncollectible-not relevant) 0 Total collections \$429,400 2. (a) The projected number of the MZB-33 computer hardware units that TabComp, Inc., will order on January 25, 2006, is calculated as follows. MZB-33 Units March sales 110 Plus: Ending inventory a 27 Total needed 137 Less: Beginning inventory b 33 Projected purchases in units 104 a 0.30 90 unit sales in April b 0.30 110 unit sales in March (b) Selling price = \$2,025,000 675 units, or for March, \$330,000 110 units = \$3,000 per unit Purchase price per unit, 60% \$3,000 \$ 1,800 Projected unit purchases x 104 Total MZB-33 purchases, \$1,800 104 \$187,200 3. Monthly cash budgets are prepared by companies such as TabComp, Inc., in order to plan for their cash needs. This means identifying when both excess cash and cash shortages may occur. A company needs to know when cash shortages will occur so that prior arrangements can be made with lending institutions in order to have cash available for borrowing when the company needs it. At the same time, a company should be aware of when there is excess cash available for investment or for repaying loans. 6-10
6-28 (40 min.) Budget schedules for a manufacturer. 1a. Revenues Budget Executive Line Chairman Line Total Units sold 740 390 Selling price \$ 1,020 \$ 1,600 Budgeted revenues \$754,800 \$624,000 \$1,378,800 b. Production Budget in Units Executive Line Chairman Line Budgeted unit sales 740 390 Add budgeted ending fin. goods inventory 30 15 Total requirements 770 405 Deduct beginning fin. goods. inventory 20 5 Budgeted production 750 400 c. Direct Materials Usage Budget (units) Oak Red Oak Oak Legs Red Oak Legs Total Executive Line: 1. Budgeted input per f.g. unit 16 4 2. Budgeted production 750 750 3. Budgeted usage (1 × 2) 12,000 3,000 Chairman Line: 4. Budgeted input per f.g. unit 25 4 5. Budgeted production 400 400 6. Budgeted usage (4 × 5) 10,000 1,600 7. Total direct materials usage (3 + 6) 12,000 10,000 3,000 1,600 Direct Materials Cost Budget 8. Beginning inventory 320 150 100 40 9. Unit price (FIFO) \$18 \$23 \$11 \$17 10. Cost of DM used from beginning inventory (8 × 9) \$5,760 \$3,450 \$1,100 \$680 \$10,990 11. Materials to be used from purchases (7 – 8) 11,680 9,850 2,900 1,560 12. Cost of DM in March \$20 \$25 \$12 \$18 13. Cost of DM purchased and used in March (11 × 12) \$233,600 \$246,250 \$34,800 \$28,080 \$542,730 14. Direct materials to be used (10 + 13) \$239,360 \$249,700 \$35,900 \$28,760 \$553,720 6-11

Subscribe to view the full document.

Direct Materials Purchases Budget Oak Red Oak Oak Legs Red Oak Legs Total Budgeted usage (from line 7) 12,000 10,000 3,000 1,600 Add target ending inventory 192 200 80 44 Total requirements 12,192 10,200 3,080 1,644 Deduct beginning inventory 320 150 100 40 Total DM purchases 11,872 10,050 2,980 1,604 Purchase price (March) \$20 \$25 \$12 \$18 ________ Total purchases \$237,440 \$251,250 \$35,760 \$28,872 \$553,322 d. Direct Manufacturing Labor Budget Output Direct Manuf. Labor- Units Hours per Total Hourly Produced Output Unit Hours Rate Total Executive Line 750 3 2,250 \$30 \$ 67,500 Chairman Line 400 5 2,000 \$30 60,000 4,250 \$127,500 e. Manufacturing Overhead Budget Variable manufacturing overhead costs (4,250 × \$35) \$148,750 Fixed manufacturing overhead costs 42,500
You've reached the end of this preview.
• Winter '10
• LAWWINGKIN
• Accounting, Finished Goods, Direct manufacturing Labor

{[ snackBarMessage ]}

### What students are saying

• As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

Kiran Temple University Fox School of Business ‘17, Course Hero Intern

• I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

Dana University of Pennsylvania ‘17, Course Hero Intern

• The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

Jill Tulane University ‘16, Course Hero Intern