Prepare a budgeted income statement for 2014

Unit Costs:

Direct materials:

Wood: 11 square feet at $24 $264

Hardware kits (screws, etc) 14 $ 278

Direct labor 0.5 hours at $36 per hour 17

Variable overhead, per unit 9

Total variable costs per unit $ 304

Fixed costs per month (rent, utilities, supervision) $75,000

Management plans to produce 9,000 units in April 2017.

Prepared a manufacturing cost budget for April 2017.

Hubert Products

Manufacturing Cost Budget

From the Month of April 2017

Direct materials

Wood $ 2,376,000 !

Hardware kits 126,000 ! $ 2,502,000 !

Direct labor 162,000 "

Variable overhead 81,000 !

Fixed manufacturing overhead 75,000 !

$ 2,820,000 "

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Total manufacturing costs $ 2,820,000 "

QUESTION 2 Partially correct 12.00 points out of 15.00

Cash Budget Wilson's Retail Company is planning a cash budget for the next three months. Estimated sales revenue is as follows:

Month Sales Revenue Month Sales Revenue

January $300,000 March $200,000

February 205,000 April 190,000

All sales are on credit; 60 percent is collected during the month of sale, and 40 percent is collected during the next month. Cost of goods sold is 70 percent of sales. Payments for merchandise sold are made in the month following the month of sale. Operating expenses total $44,000 per month and are paid during the month incurred. The cash balance on February 1 is estimated to be $40,000.

Prepare monthly cash budgets for February, March, and April.

Use negative signs only with beginning and ending cash balances, when appropriate. Do not use negative signs with disbursement answers.

Wilson's Retail Company Cash Budgets

February, March, and April

February March April

Cash balance, beginning $ 40,000 ! $ 29,000 ! $ 43,500 !

Total Cash receipts 243,000 ! 202,000 ! 194,000 !

Cash available 283,000 ! 231,000 ! 237,500 !

Total disbursements (254,000) " (187,500) " (184,000) "

Cash balance, ending $ 29,000 ! $ 43,500 ! $ 53,500 !

QUESTION 3 Partially correct 6.00 points out of 7.00

Budgeted Income Statement Pendleton Company, a merchandising company, is developing its master budget for 2015. The income statement for 2014 is as follows:

Pendleton Company Income Statement

For Year Ending December 31, 2014

Gross sales $3,500,000

Less: Estimated uncollectible accounts (70,000)

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Net sales 3,430,000

Cost of goods sold (1,925,000)

Gross profit 1,505,000

Operating expenses (including $25,000 depreciation) (875,000)

Net income $630,000

The following are management’s goals and forecasts for 2015:

1. Selling prices will increase by 6 percent, and sales volume will increase by 4 percent.

2. The cost of merchandise will increase by 3 percent.

3. All operating expenses are fixed and are paid in the month incurred. Price increases for operating expenses will be 10 percent. The company uses straight-line depreciation.

4. The estimated uncollectibles are 2 percent of budgeted sales.

Required Prepare a budgeted functional income statement for 2015.

Do not use negative signs with any of your answers.

Pendleton Company Budgeted Income Statement

For the Year Ending December 31, 2015

Sales $ 3,858,400 !

Less: Estimated uncollectible accounts 77,168 !

Net sales 3,781,232 !

Cost of goods sold (2,062,060) "

Gross profit 1,719,172 !

Operating expenses 960,000 !

Net income $ 759,172 !