The variable portion is based on DL hours January February Estimated DL Hours

The variable portion is based on dl hours january

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The variable portion is based on DL hours January February Estimated DL Hours 2,600 2,850 Value of Fixed Variable Depreciation 1500 0 1,500 1,500 Indirect Material 0 0.25 650 713 Indirect Labor 6000 1.75 10,550 10,988 Utilities 400 0.05 530 543 Property Tax 600 0 600 600 Insurance 500 0 500 500 Maintenance 600 0.35 1,510 1,598 Total Cost $9,600.00 $2.40 $15,840.00 $16,440.00 Total Cost Net of Depreciation $14,340.00 $14,940.00 All cost are paid as incurred Cash Payments January $14,340.00 February $14,940.00
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March $13,380.00 Selling and Administrative Budget 1. They will have the following monthly expenses: a. Salary Expense (Fixed) $14,000 b. Sales Commissions 5% of sales c. Supplies Expense 2% of sales d. Utilities (Fixed) $800 e. Rent (Fixed) $2,400 f. Miscellaneous (Fixed) $900 Equipment Cost $17,000 Salvage Value $2,000 Life 5 years Depreciation (per month) $250 January February March Salary Expense $14,000 $14,000 $14,000 Sales Commissions $6,000 $7,200 $5,400 Supplies Expense $2,400 $2,880 $2,160 Utilities $800 $800 $800 Rent $2,400 $2,400 $2,400 Misc $900 $900 $900 Depreciation $250 $250 $250 Total Expense $26,750 $28,430 $25,910 Cash Collections Sales Commissions and utilities are paid in the month after the month in which they are incurred All other expenses are paid in the month in which they are incurred. December Budgets Sales Commission $10,000 Utilities $800 January February March Salary Expense $14,000 $14,000 $14,000 Sales Commissions 10,000 $6,000 $7,200 Supplies Expense $2,400 $2,880 $2,160 Utilities $800 $800 $800 Rent $2,400 $2,400 $2,400 Misc $900 $900 $900
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Total Cash Payments $30,500 $26,980 $27,460 NOTE: Depreciation is a non-cash expense CASH BUDGET Using a line of credit, Mikey borrows and repays principle in increments of $1,000 on the last day of the month as needed Company policy is to maintain an ending cash balance of at least $50,000. The ending balance on the December cash budget is $50,000. 12/31 Debt outstanding $10,000 Interest 1% per month Cash Budget: January February March Beginning Cash Balance $50,000 $50,260 $50,342 Cash Receipts $143,800 $136,860 $118,710 Total Cash Available $193,800 $187,120 $169,052 Cash Payments: Inventory Purchases $79,800 $42,768 $41,704 Direct Labor $20,800 $22,800 $17,600 Overhead $14,340 $14,940 $13,380 S&A $30,500 $26,980 $27,460 Interest $100 $290 $0
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