BettyBaskets (1) by Munesh Kumar

Betty's Beautiful Baskets

Sales Budget
For the Three Months ending, March 31, 2010
January February March Total
Projected Sales 5,000 4,000 6,000 15,000
Unit Price 35.00 35.00 35.00 35.00
Total Projected Sales 175,000 140,000 210,000 525,000
Production Budget
January February March
Projected Sales 5,000 4,000 6,000
Ending Inventory 800 1,200 1,000
Total Units Needed 5,800 5,200 7,000
Beginning Inventory 1,000 800 1,200
Projected Production 4,800 4,400 5,800
*** Ending inventory is 20% of next month's budgeted sales

*** April's projected sales is 5,000 units
*** December's ending inventory is 1,000 units
Direct Materials Budget
Material per Unit (g) 4 4 4
Material for Units to be Produced (g) 19,200 17,600 23,200
Plus Material in Ending inventory (g) 4,640 5,000
Total Material Needed (g) 19,200 22,240 28,200
Less Material in Beginning inventory (g) 4,800 - 4,640
Total Material to Purchase (g) 14,400 22,240 23,560
Unit Price of Material 2.5 2.5 2.5
Projected Purchase 36,000 55600 58900
*** Each Unit requires 4 grams of material

*** Ending Inventory - 20% of next month's needs
*** December's cost of Material in Ending Inventory is 4,800
*** Unit Price of Material is £ 2.50 per gram
Schedule of Expected Cash Disbursement

December Purchases 15,000
January's Purchases 28,800 7,200
February's Purchases 44,480 11,120
March's Purchases 47,120
Total Cash Disbursements per Month 43,800 51,680 58,240
*** 80% of Purchases are paid in the current month

*** 20% of Purchases are paid in the following month

Direct Labour Budget
X Direct Labour Hours 0.75 0.75 0.75
Total Direct Labour Hours 3,600 3,300 4,350
X Direct Labour Cost 8.5 8.5 8.5
Total Direct Labour Cost 30,600 28,050 36,975
*** Each Unit requires 0.75 hours of Direct Labour

*** Direct Labour £8.5/hour
Manufacturing Overhead Budget
Direct Labour Hours 3,600 3,300 4,350
Variable Overhead Rate 8 8 8
Projected Variable Overhead 28,800 26,400 34,800
Projected Fixed Overhead 3,000 3,000 3,000
Total Projected Overhead 31,800 29,400 37,800
*** Manufacturing Overhead is calculated based on:

Variable Overhead Rate: $8/Direct Labour Hour
Fixed Overhead Rate: $3,000 per month
Selling & Administrative Expense Budget
Salaries 6,000 6,000 6,000
Rent 1,500 1,500 1,500
Advertising 1,100 1,100 1,100
Telephone 300 300 300
Other 500 500 500
Total Expenses 9,400 9,400 9,400
*** Monthly Expenses are as follows:

Salaries 6000
Rent 1500
Advertising 1100
Telephone 300
Other 500
Cost of Goods Sold
Projected Direct Materials 36,000 55,600 58,900
Projected Direct Labour 30,600 28,050 36,975
Projected Manu. Overhead 31,800 29,400 37,800
Total 98,400 113,050 133,675
Budgeted Income Statement
Sales 175,000 140,000 210,000 525,000
Cost of Goods Sold 98,400 113,050 133,675 345,125
Operating Expenses
Selling & Administration 9,400 9,400 9,400 28,200
Net Income From Operations 67,200 17,550 66,925 151,675
Net Income Before Taxes 67,200 17,550 66,925 151,675

Federal Income Tax 14,800 3,900 14,700 33,400
Net Income 52,400 13,650 52,225 118,275
*** Federal Income Tax 22%
Schedule of Accounts Receivable

December Sales 2,000 2,000
January Sales 140,000 35,000 175,000
February Sales 112,000 28,000 140,000
March Sales 168,000 168,000
Total 142,000 147,000 196,000 485,000
*** 80% collected in current month

*** 20% collected in the following month
*** Bad Debts is negligible
Cash Budget
Cash Balance, Beginning 20,000 46,400 74,870
Cash Receipts 142,000 147,000 196,000
Cash Available 162,000 193,400 270,870
Cash Payments
Direct Material 43,800 51,680 58,240
Direct Labour 30,600 28,050 36,975
Manufacturing Overhead 31,800 29,400 37,800
Selling & Admin Expenses 9,400 9,400 9,400
Income Taxes 33,400
Dividends 8,000
Total Cash Payments 115,600 118,530 183,815
Cash Balance, Ending 46,400 74,870 87,055
*** Cash Balance Beginning £ 20,000

*** The business prefers to pay the projected Federal taxes in March
*** The business pays a dividend of £ 8,000 in March
Budgeted Balance Sheet
Assets Liabilities
Current Assets: Accounts Payable 11,780.00
Cash 87,055.00 Total Liabilities 11,780.00
Accounts Receivable 42,000.00
Raw Materials 12,500.00 Equity
Finished Goods 22,380.00 Common Stock 225,000.00
Total Current Assets 163,935.00 Retained Earnings 58,780.00
Fixed Assets: Net Income 52,225.00
Land 150,000.00 Retained Earnings 111,005.00
Building 45,000.00 Total Equity 336,005.00
Less Depreciation (11,250.00)
Total Fixed Assets 183,750.00
Total Assets 347,685.00 Total Liabilities and Equity 347,785.00
*** Finished Goods = Ending Inventory (Production Budget) multiplied by cost of unit
Cost of unit = 2.5 g material x 4 grams + 0.75 hour x £8.5/hour + 0.75 hour x £8/hour
Cost of unit = £ 22.38

BettyBaskets (1) by Munesh Kumar

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

BettyBaskets (1) by Munesh Kumar

Uploaded by

Copyright:

Available Formats

Betty's Beautiful Baskets

Betty's Beautiful Baskets

*** Ending inventory is 20% of next month's budgeted sales

*** Each Unit requires 4 grams of material

Schedule of Expected Cash Disbursement

*** 80% of Purchases are paid in the current month

Betty's Beautiful Baskets

*** Each Unit requires 0.75 hours of Direct Labour

*** Manufacturing Overhead is calculated based on:

*** Monthly Expenses are as follows:

Net Income Before Taxes 67,200 17,550 66,925 151,675

*** Federal Income Tax 22%

Schedule of Accounts Receivable

*** 80% collected in current month

Cash Balance, Ending 46,400 74,870 87,055

*** Cash Balance Beginning £ 20,000

You might also like