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Prepare the budgets for each month in the first quarter of 2104for the Bullwinkle, Inc.

*Slaes

Unit Selling Price $12.00

Unit Sales for November, 2013 $112,500.00

Unit Sales for December, 2013 $102,100.00

Expected unit sales for May, 2014 $137,500.00

Expected unit sales for April, 2014 $125,000.00

Expected unit sales for March, 2014 $116,000.00

Expected unit sales for February, 2014 $112,500.00

Expected unit sales for January, 2014 $113,000.00

Bullwinkle, Inc. likes to keep 10% of the next month's unitsales in ending inventory. All sales are on account. 85% of theAccounts Receivalbe are collected in the month of sale, and 15% ofthe Account Receivable are collected in the mont after sale.Account Receivable on December 31,2013, totaled $183,780.

Desired Ending Direct Materials 3/31/14 12625.0lbs

Metal, Plastic, and Rubber together are $0.75 per pound perunit.

Bullwinkle, Inc. likes to keep 5%of the materials needed ofr thenext month in ending inventory. Payment for materials is madewithin 15 days. 50% is paid in the month of purchase, and 50% ispaid in the month after purchase. Accounts Payable on December 31.2013 totaled $120,595 and were paid in full in January 2014.Beginning Raw Materials on December 31,2013 was 11,295 pounds.

*Direct Labor

Labor requires 2 pounds per unit for completion and is paid at arate of $8.00 per hour.

================================================================

*Sales Budget

Jan Feb Mar Total
Expected unit sales 113000 112500 116000 341500
Unitselling price X $12 X $12 X $12 X $12
TotalSales 1356000 1350000 1392000 4098000

*Production Budget

Jan Feb Mar Total
Expected Unit Sales 113000 112500 116000
Add:Desired ending finished goods units 11250 11600 12500
Totalrequired units 124250 124100 128500
Less:Begginnng finished goods units 10210 11250 11600
Required production units 114040 112850 116900 343790

Prepare a direct materials budget (Round to nearest dollar) inthis order:

Units to beproduced
Direct materials per unit
Total
Add: ending materials
Total materials required
Less: Beginning materials
Direct materialspurchases
Cost per pound
Total cost of direct materialspurchases

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28 Sep 2019

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Prepare the budgets for each month in the first quarter of 2104for the Bullwinkle, Inc.

*Slaes

Unit Selling Price $12.00

Unit Sales for November, 2013 $112,500.00

Unit Sales for December, 2013 $102,100.00

Expected unit sales for May, 2014 $137,500.00

Expected unit sales for April, 2014 $125,000.00

Expected unit sales for March, 2014 $116,000.00

Expected unit sales for February, 2014 $112,500.00

Expected unit sales for January, 2014 $113,000.00

Bullwinkle, Inc. likes to keep 10% of the next month's unitsales in ending inventory. All sales are on account. 85% of theAccounts Receivalbe are collected in the month of sale, and 15% ofthe Account Receivable are collected in the mont after sale.Account Receivable on December 31,2013, totaled $183,780.

Desired Ending Direct Materials 3/31/14 12625.0lbs

Metal, Plastic, and Rubber together are $0.75 per pound perunit.

Bullwinkle, Inc. likes to keep 5%of the materials needed ofr thenext month in ending inventory. Payment for materials is madewithin 15 days. 50% is paid in the month of purchase, and 50% ispaid in the month after purchase. Accounts Payable on December 31.2013 totaled $120,595 and were paid in full in January 2014.Beginning Raw Materials on December 31,2013 was 11,295 pounds.

*Direct Labor

Labor requires 2 pounds per unit for completion and is paid at arate of $8.00 per hour.

For the First quarter of 2014, do the following:

1. Sales budget,

2. production budget,

3. direct materials budget (round to nearest dollar),

4. direct labor budget (round to the nearest dollar),

Prepare the budgets for each month in the first quarter of 2104for the Bullwinkle, Inc.

*Slaes

Unit Selling Price $12.00

Unit Sales for November, 2013 $112,500.00

Unit Sales for December, 2013 $102,100.00

Expected unit sales for May, 2014 $137,500.00

Expected unit sales for April, 2014 $125,000.00

Expected unit sales for March, 2014 $116,000.00

Expected unit sales for February, 2014 $112,500.00

Expected unit sales for January, 2014 $113,000.00

Bullwinkle, Inc. likes to keep 10% of the next month's unitsales in ending inventory. All sales are on account. 85% of theAccounts Receivalbe are collected in the month of sale, and 15% ofthe Account Receivable are collected in the mont after sale.Account Receivable on December 31,2013, totaled $183,780.

Desired Ending Direct Materials 3/31/14 12625.0lbs

Metal, Plastic, and Rubber together are $0.75 per pound perunit.

Bullwinkle, Inc. likes to keep 5%of the materials needed ofr thenext month in ending inventory. Payment for materials is madewithin 15 days. 50% is paid in the month of purchase, and 50% ispaid in the month after purchase. Accounts Payable on December 31.2013 totaled $120,595 and were paid in full in January 2014.Beginning Raw Materials on December 31,2013 was 11,295 pounds.

*Direct Labor

Labor requires 2 pounds per unit for completion and is paid at arate of $8.00 per hour.

*Manufacturing Overhead

Indirect Materials $0.30 per labor hour

Indirect Labor $0.50 per labor hour

Utilities $0.45 per labor hour

Maintenace $0.25 per labor hour

Salaries $42,000 per month

Depreciation $16,800 per month

Property Taxes $2675 per month

insurance $1200 per month

Janitorial $1300 per month

All manufacturing overhead costs are variable except salaries,depreciation, property taxes, insurance and janitorial.

*Selling and Administrative Expenses

Variable selling and Administrative cost per unit is $1.60

Advertising $15,000 a month

Insurance $1,400 a month

Salaries $72,000 a month

Depreciation $2,500 a month

Other fixed cost $3,000 a month

*Other info

Cash balance on December 31,2013, totaled $100,500 butmanagement has decided it would like to maintain a cash balance ofat least $800,000 beginning on January 31, 2014. Dividends are paideach month at the rate of $2.50 per share for 5000 sharesoutstanding. The company has an open line of credit with ExchangeBank. The terms of agreement requires borrowing to be in $1000increments at 8% interest. The funds borrowed in January 2014 werepaid back on February 28, 2014. A $500,000 equipment purchase isplanned for February, 2014

1. schedule for expected cash collection from custormers,

2. schedule for expected payments for materials purchases (roundtotals to nearest dollar),

3. cash budget.

Waterways Corporation is preparing its budget for the coming year, 2017. The first step is to plan for the first quarter of that coming year. Waterways gathered the following information from the managers:

Sales

Unit sales for November 2016 112,500

Unit sales for December 2016 102,100

Expected unit sales for January 2017 113,000

Expected unit sales for February 2017 112,500

Expected unit sales for March 2017 116,000

Expected unit sales for April 2017 125,000

Expected unit sales for May 2017 137,500

Unit selling price $12

Waterways likes to keep 10% of the next month’s unit sales in ending inventory. All sales are on account. 85% of the Accounts Receivable are collected in the month of sale, and 15% of the Accounts Receivable are collected in the month after sale. Accounts receivable on December 31, 2016, totaled $183,780.

Direct Materials

Item Amount Used per Unit Inventory, Dec. 31

Metal 1 lb @ 58¢ per lb. 5,177.5 lbs

Plastic 12 oz @ 6¢ per oz 3,883.125 lbs

Rubber 4 oz @ 5¢ per oz 1,294.375 lbs

2 lbs per unit 10,355.0 lbs

Metal, plastic, and rubber together are 75¢ per pound per unit.

Waterways likes to keep 5% of the materials needed for the next month in its ending inventory. Payment for materials is made within 15 days. 50% is paid in the month of purchase, and 50% is paid in the month after purchase. Accounts Payable on December 31, 2016, totaled $120,595. Raw Materials on December 31, 2016, totaled 11,295 pounds.

Direct Labor

Labor requires 12 minutes per unit for completion and is paid at a rate of $8 per hour.

Manufacturing Overhead

Indirect materials 30¢ per labor hour

Indirect labor 50¢ per labor hour

Utilities 45¢ per labor hour

Maintenance 25¢ per labor hour

Salaries $42,000 per month

Depreciation $16,800 per month

Property taxes $ 2,675 per month

Insurance $ 1,200 per month

Janitorial (Maintenance) $ 1,300 per month

Selling and Administrative

Variable selling and administrative cost per unit is $1.60.

Advertising $15,000 a month

Insurance $ 1,400 a month

Salaries $72,000 a month

Depreciation $ 2,500 a month

Other fixed costs $ 3,000 a month

Other Information

* The Cash balance on December 31, 2016, totaled $100,500, but management has decided it would like to maintain a cash balance of at least $800,000 beginning on January 31, 2017.

* Dividends are paid each month at the rate of $2.50 per share for 5,000 shares

outstanding.

* The company has an open line of credit with Romney’s Bank. The terms of the agreement requires borrowing to be in $1,000 increments at 8% interest. Waterways borrows on the first day of the month and repays on the last day of the month.

* A $500,000 equipment purchase is planned for February.

Instructions

For the first quarter of 2017, do the following.

(a) Prepare a sales budget.

(b) Prepare a production budget.

(c) Prepare a direct materials budget.

(d) Prepare a direct labor budget.

(e) Prepare a manufacturing overhead budget.

(f) Prepare a selling and administrative budget.

(g) Prepare a schedule for expected cash collections from customers.

(h) Prepare a schedule for expected payments for materials purchases.

(i) Prepare a cash budget.

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