MANAGERIAL ACCOUNTING - Fourth Edition

Solutions Manual

PRESIDIO MANUFACTURING
Master Budget

Unit Sales
Selling Price
Total Sales Revenue

Cash Sales
Credit Sales
Total Cash Collections

Unit sales
Plus: Desired ending Inventory
Total Needed
Less: Beginning Inventory
Number of units to produce

Chapter 9: The Master Budget

Sales Budget
January
8300
$12.00
$99,600.00

February
9900
$12.00
$118,800.00

9600
$12.00
$115,200.00

Cash Collections Budget

January
$34,860.00
$46,150.00

February
$41,580.00
$64,740.00

March
$40,320.00
$77,220.00

$81,010.00

$106,320.00

$117,540.00

Production Budget
January
8300
990
9290
830
8460

February
9900
960
10860
990
9870

December
5917
$12.00
$71,000.00

March

March
9600
900
10500
960
9540

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MANAGERIAL ACCOUNTING - Fourth Edition

Solutions Manual
Direct Materials Budget
January
8460

Units to be produced (from Production Budget

Multiply by: Quantity (pounds) of DM needed per unit
Quantity (pounds) needed for production
Plus: Desired ending inventory of DM
Total quantity (pounds) needed
Less: Beginning inventory of DM
Quantity (pounds) to purchase
Multiply by: Cost per pound
Total cost of DM purchases

$
$

February
9870

3
25380
5922
31302
5076
26226
2 $
52,452.00 $

March
9540

3
29610
5724
35334
5922
29412
2 $
58,824.00 $

3
28620
5376
33996
5724
28272
2
56,544.00

Cash Payments for Direct Material Purchases Budget

January
February
December Purchases from Accounts Payable
$
43,000.00
January Purchases
$
10,490.40 $
41,961.60
February Purchases
$
11,764.80
March Purchases

$
$

47,059.20
11,308.80

Total Cash Payments

53,726.40

58,368.00

Cash Payments for Direct Labor Budget

January
February
$
3,807.00 $
4,442.00

March
4,293.00

Total Cost of Direct Labor

Chapter 9: The Master Budget

53,490.40

March

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MANAGERIAL ACCOUNTING - Fourth Edition

Variable Manufacturing Overhead Costs

Rent (Fixed)

Solutions Manual

Cash Payments for Manufacturing Overhead Budget

January
February
$
9,306.00 $
10,857.00
$
5,500.00 $
5,500.00
$
2,900.00 $
2,900.00

$
$
$

March
10,494.00
5,500.00
2,900.00

19,257.00

18,894.00

Cash Payments for Operating Expenses Budget

January
February
$
10,375.00 $
12,375.00
$
1,800.00 $
1,800.00
$
12,175.00 $
14,175.00

$
$
$

March
12,000.00
1,800.00
13,800.00

$
$
$

March
4,951.20
117,540.00
122,491.20

$
$
$
$

58,368.00
4,293.00
18,894.00
13,800.00

$
$
$

16,600.00
111,955.00
10,536.20

Other fixed MOH

Cash Payments for Manufacturing Overhead

Variable Operating Expenses

Fixed Operating Expenses
Cash Payments for Operating Expenses

Beginning Cash Balance

Plus: Cash Collections
Total Cash Available
Less Cash Payments:
Direct Material Purchases
Direct Labor
Manufacturing Overhead Costs
Operating Expenses
Tax Payment
Equipment Purchases
Total Cash Payments
Ending Cash Balance Before Financing
Financing:
Plus: New borrowings
Less: Debt repayments
Less Interest Payments
Total Financing
Ending Cash Balance
Chapter 9: The Master Budget

17,706.00

Combined Cash Budget

January
$
4,600.00
$
81,010.00
$
85,610.00

$
$
$

February
4,431.60
106,320.00
110,751.60

$
$
$
$
$
$
$
$

53,490.40
3,807.00
17,706.00
12,175.00
5,000.00
92,178.40
(6,568.40)

$
$
$
$
$
$
$
$

53,726.40
4,442.00
19,257.00
14,175.00
10,000.00
12,200.00
113,800.40
(3,048.80)

$
$
$

11,000.00
-

$
$
$

8,000.00
-

$
$
$

6,000.00
490.00

$
$

11,000.00
4,431.60

$
$

8,000.00
4,951.20

$
$

6,490.00
4,046.20
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MANAGERIAL ACCOUNTING - Fourth Edition

Solutions Manual

Budgeted Manufacturing Cost per Unit

Direct Materials Cost Per Unit
Direct Labor Cost Per Unit
Variable Manufacturing Overhead Costs Per Unit
Fixed Manufacturing Overhead Costs Per Unit
Budgeted Cost of Manufacturing One Unit

Budgeted Income Statement

Sales Revenue
Less:Cost of Goods Sold
Gross Profit
Less: Operating Expenses
Less: Depreciation Expense
Operating Income
Less: Interest Expense
Less: Income Tax Expense
Net Income

Chapter 9: The Master Budget

$333,600.00
229,350.00
$104,250.00
$
40,150.00
4600
$59,500.00
$
490.00
17,703.00
$

$41,307.00

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MANAGERIAL ACCOUNTING - Fourth Edition

April
9000
$12.00
$108,000.00 $

Solutions Manual

May
8600
12.00
103,200.00

Quarter
$37,800.00
$74,880.00
$112,680.00

Quarter
27800
900
28700
830
27870

Chapter 9: The Master Budget

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MANAGERIAL ACCOUNTING - Fourth Edition

Solutions Manual

Quarter
27870

$
$

3
83610
5376
88986
5076
83910
2
167,820.00

$
$
$
$

Quarter
43,000.00
52,452.00
58,824.00
11,308.80

165,584.80

Quarter
12,542.00

Chapter 9: The Master Budget

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MANAGERIAL ACCOUNTING - Fourth Edition

$
$
$

Quarter
30,657.00
16,500.00
8,700.00

55,857.00

$
$
$

Quarter
34,750.00
5,400.00
40,150.00

$
$
$

Quarter
4,600.00
304,870.00
309,470.00

$
$
$
$
$
$
$
$

165,584.80
12,542.00
55,857.00
40,150.00
10,000.00
33,800.00
317,933.80
(8,463.80)

$
$
$

19,000.00
6,000.00
490.00

$
$

12,510.00
4,046.20

Chapter 9: The Master Budget

Solutions Manual

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MANAGERIAL ACCOUNTING - Fourth Edition

$
$
$
$
$

Solutions Manual

6.00
0.45
1.10
0.70
8.25

Chapter 9: The Master Budget

Page 8 of 8