Instructions: Type Amounts from CAP # 1 Financial Statements Name

Enter formulas for Sub-totals and Unit costs.

$ Amounts - Whole dollars; $ per unit - 3 decimal places.

CAP #1 SPREADSHEET

Actual Level Of Activity for March: Production 14,960 units ← from Goods Manufactured Statement
Sales 8,734 units ← from Income Statement

$ Amounts $ Sub-totals $/unit Sub-totals

FIXED COSTS/EXPENSES:
Marketing
Sales Salaries 405,000
Sales Training 86,160
Advertising 297,200
Sales Office Rentals 15,000
Sales Office Operations 60,000
Home Office Selling Expense 24,375
Credit Department Expense 0
Total Marketing Fixed Costs 887,735

General & Administrative

Executive Salaries 90,000
Secretarial and Clerical 10,000
Depreciation, Building 1,666
Depreciation, Furniture & Fixtures 2,500
Supplies 5,000
Total General & Administrative 109,166

Manufacturing
Indirect Production Labor 145,000
Production Planning & Control 10,000
Purchasing and Receiving 106,149
Factory Insurance 2,000
Training 5,000
Depreciation, PET 30,833
Depreciation, Building 6,667
Utilities 3,500
Supplies 1,000
Total Manufacturing 310,149

Total Fixed Costs/Expenses 1,307,050

VARIABLE COSTS/EXPENSES $ Amounts $ Sub-totals Cost per Unit ($00.000)

Marketing
Sales Commissions 209,607
Sales Travel 47,413
Packaging 17,468
Bad Debts 0
Credit Department Expense 0
Total Marketing Unit Variable Costs 274,488 31.428 per unit sold

General & Administrative

Travel 21,310
Supplies 8,734
Total General & Administrative Unit Variable Costs 30,044 3.440 per unit sold

Manufacturing
Material Ex-11 367,296
Material Wy-22 347,300
ALL Materials 714,596 47.767 per unit produced
Direct Labor--Cutting 149,600
Direct Labor--Assembly 90,194
Direct Labor--Finishing 0
ALL Direct Labor 239,794 16.029 per unit produced
Repairs & Maintenance 29,920
Spoilage 27,600
Utilities 11,220
Supplies 11,220
ALL Manufacturing Overhead 79,960 5.345 per unit produced
Total Manufacturing Unit Variable Costs 1,034,350 69.141 per unit produced

Total Variable Costs/Expenses 1,338,882 104.008 per unit (total)

REQUIRED:
1 What is the linear equation that represents total costs/expenses for B.Widget ? 2863016.52
(in the form TC = vQ + F, where v and F are total dollar amounts determined above)

2 Compute TOTAL marketing, general and administrative, and manufacturing fixed costs
and TOTAL variable costs for B.Widget at each of the following activity levels:

# of Units Marketing Gen & Admin Manufacturing Total Cost per Unit

10,000 Fixed 887,735 109,166 310,149 $234.7135

Variable 314,275 34,399 691,410

20,000 Fixed 887,735 109,166 310,149 $169.3610

Variable 628,550 68,798 1,382,821

30,000 Fixed 887,735 109,166 310,149 $147.5768

Variable 942,826 103,197 2,074,231

40,000 Fixed 887,735 109,166 310,149 $136.6847

Variable 1,257,101 137,596 2,765,642
 B. Widget Company
Balance Sheet
March 31, 2003

Net
Account GROUP
ASSETS Totals: TOTALS:
CURRENT:
Cash $0
Accounts Receivable $0
Allowance for Bad Debts (0) 0
Inventory:
Raw Materials 237,304
Finished Product 674,347 911,651
TOTAL CURRENT ASSETS 911,651
FIXED:
Production Equipment & Tools 3,700,000
Accumulated Depreciation, PET (92,500) 3,607,500

Furniture & Fixtures 300,000

Accumulated Depreciation, F&F (7,500) 292,500

Building 2,000,000
Accumulated Depreciation, Bldg. (25,000) 1,975,000
TOTAL FIXED ASSETS 5,875,000
INVESTMENTS:
Investments in Stock 0 0

TOTAL ASSETS 6,786,651

LIABILITIES
CURRENT:
Accounts Payable $0
Notes Payable - First National Bank 500,000
Notes Payable - Commerce Bank 450,093
Accrued Income Taxes Payable (345,532)
TOTAL CURRENT LIABILITIES 604,561
LONG TERM:
Bonds Payable 3,000,000
( 3,000,000 less discount 51,543.63 ) (57,544) 2,942,456

TOTAL LIABILITIES 3,547,017

STOCKHOLDERS' EQUITY
Common Stock (Authorized: 80,000; Issued:30,000) 3,000,000
Premium (Discount) on Common Stock 600,000
Retained Earnings (Deficit) (360,366)

TOTAL STOCKHOLDERS' EQUITY 3,239,634

TOTAL LIABILITIES and STOCKHOLDERS' EQUITY 6,786,651

 B. Widget Company
Income Statement
for the month ending March 31, 2003

Region 1 Region 2 Region 3 Region 4 Total

SALES* 394,000 525,400 827,400 0 1,746,800

COST OF GOODS SOLD 177,864 237,181 373,514 0 788,559
GROSS PROFIT 216,136 288,219 453,886 0 958,241

EXPENSES:
Selling
Sales Salaries 108,000 117,000 180,000 0 405,000
Sales Commissions 47,280 63,039 99,288 0 209,607
Sales Training 30,120 8,760 47,280 0 86,160
Sales Travel 17,730 13,135 16,548 0 47,413
Advertising 92,000 80,200 125,000 0 297,200
Packaging 3,940 5,254 8,274 0 17,468
Bad Debts 0 0 0 0 0
Sales Office Rentals 5,000 5,000 5,000 0 15,000
Sales Office Operations 20,000 20,000 20,000 0 60,000
Home Office Selling Expense 5,498 7,331 11,546 0 24,375
Credit Department Expense 0 0 0 0 0
Total Selling Expense 329,568 319,719 512,936 0 1,162,223

General & Administrative

Executive Salaries 20,300 27,070 42,630 0 90,000
Secretarial and Clerical 2,255 3,008 4,737 0 10,000
Depreciation, Building 376 501 789 0 1,666
Depreciation, Furniture & Fixtures 564 752 1,184 0 2,500
Travel 9,850 5,254 6,206 0 21,310
Supplies 3,098 4,131 6,505 0 13,734
Total General & Administrative 36,443 40,716 62,051 0 139,210

TOTAL EXPENSES 366,011 360,435 574,987 0 1,301,433

NET OPERATING INCOME (LOSS) (149,875) (72,216) (121,101) 0 (343,192)

OTHER INCOME (EXPENSE)

Interest Income 0
Other Income 0
Interest Expense (28,181)
Other Expense 0

TOTAL OTHER INCOME (EXPENSE) (28,181)

NET INCOME BEFORE TAXES (371,373)

Income Tax Expense 148,549

NET INCOME (222,824)

* Widgets sell for $200 per unit.

 B. Widget Company
Cost of Goods Manufactured
for the month ending March 31, 2003

NUMBER OF WIDGETS MANUFACTURED: 14,960 Units

Quantity $ Amount Subtotal TOTAL

MATERIALS:
Material Purchases:
Material Ex-11 76,000 $478,800
Material Wy-22 40,000 400,000
Freight-in See NOTE 1 below 45,600 924,400
Beginning Inventory:
Material Ex-11 0 $0
Material Wy-22 2,500 27,500 27,500
Ending Inventory:
Material Ex-11 16,160 $111,504
Material Wy-22 12,580 125,800 237,304
TOTAL MATERIALS USED 714,596

DIRECT LABOR:
Cutting Department 149,600
Assembly Department 90,194
Finishing Department 0
TOTAL DIRECT LABOR: 239,794

MANUFACTURING OVERHEAD:
Variable:
Repairs & Maintenance 29,920
Spoilage 27,600 57,520
Fixed:
Indirect Production Labor 145,000
Production Planning & Control 10,000
Purchasing and Receiving 106,149
Factory Insurance 2,000
Training 5,000
Depreciation, PET 30,833
Depreciation, Building 6,667 305,649
Mixed:
Utilities 14,720
Supplies 12,220 26,940
TOTAL MANUFACTURING OVERHEAD: 390,109

TOTAL COST OF GOODS MANUFACTURED 1,344,499

NOTE 1
All freight-in costs are for Wy-22;
no freight for Ex-11
 B. Widget Company
Finished Product Inventory
for the month ending March 31, 2003

Units $ Amount

Beginning Inventory March 1, 2003 1,243 118,407

Goods Manufactured 14,960 1,344,499

Goods Available for Sale 16,203 1,462,906

Goods Sold 8,734 788,559

Ending Inventory March 31, 2003 7,469 674,347