Exercise 8-16 Name:

Enter answers in the gray-shaded cells. The essay answer will not be graded.

1 Archer Company
Sales Budget
For the Year Ended December 31
Quarter 1 Quarter 2 Quarter 3
Custom:
Units 9,000.00 12,000.00 16,000.00
x Unit price 30.00 30.00 30.00
Sales 270,000.00 360,000.00 480,000.00

Basic:
Units 90,000.00 88,400.00 92,000.00
x Unit price 8.00 8.00 8.00
Sales 720,000.00 707,200.00 736,000.00
Total sales 990,000.00 1,067,200.00 1,216,000.00

Controller may have ased the Sales Manager about sales forecast and prevailing market price;
the Production Manager about the cost per unit;Sales Manager may have considered market
trends, actual historical sales in forecasting sales.

3 Archer Company
Production Budget
Quarters 1–3
Quarter 1 Quarter 2
Production budget for customs:
Unit sales 9,000.00 12,000.00
Desired ending inventory (20% of next Q' 2,400.00 3,200.00
Total needed 11,400.00 15,200.00
Less: Beginning inventory 800.00 2,400.00
Units produced 10,600.00 12,800.00

Production budget for basics:

Unit sales 90,000.00 88,400.00
Desired ending inventory (10% of next Q' 8,840.00 9,200.00
Total needed 98,840.00 97,600.00
Less: Beginning inventory 1,140.00 8,840.00
Units produced 97,700.00 88,760.00
 Quarter 4 Year

20,000.00 57,000.00
30.00 30.00
600,000.00 1,710,000.00 1,710,000.00

91,600.00 362,000.00
8.00 8.00
732,800.00 2,896,000.00
1,332,800.00 4,606,000.00

and prevailing market price;

y have considered market

Quarter 3

16,000.00
4,000.00
20,000.00
3,200.00
16,800.00

92,000.00
9,160.00
101,160.00
9,200.00
91,960.00
Exercise 8-17 Na

Enter the appropriate amounts in the shaded cells in columns D, F, H, and J.

1 Macchu Company
Direct Materials Purchases Budget for Fabric
For the Fourth Quarter

October November December

Units produced 42,000.00 90,000.00 50,000.00
× DM per unit (yards) 0.30 0.30 0.30
Production needs 12,600.00 27,000.00 15,000.00
Desired ending inventory (yards) 2,700.00 1,500.00 1,200.00
Total needed 15,300.00 28,500.00 16,200.00
Less: Beginning inventory 1,260.00 2,700.00 1,500.00
Direct materials to be purchased 14,040.00 25,800.00 14,700.00
× Cost per yard 3.50 3.50 3.50
Total purchase cost 49,140.00 90,300.00 51,450.00

2 Macchu Company
Direct Materials Purchases Budget for Polyfiberfill
For the Fourth Quarter

October November December

Units produced 42,000.00 90,000.00 50,000.00
× DM per unit (ounces) 8.00 8.00 8.00
Production needs 336,000.00 720,000.00 400,000.00
Desired ending inventory (ounces) 108,000.00 60,000.00 48,000.00
Total needed 444,000.00 780,000.00 448,000.00
Less: Beginning inventory 50,400.00 108,000.00 60,000.00
Direct materials to be purchased 393,600.00 672,000.00 388,000.00
× Cost per ounce 0.05 0.05 0.05
Total purchase cost 19,680.00 33,600.00 19,400.00

3 Macchu Company
Direct Labor Budget
For the Fourth Quarter

October November December

Units produced 42,000.00 90,000.00 50,000.00
× Direct labor time per unit (hours) 0.25 0.25 0.25
Direct labor hours needed 10,500.00 22,500.00 12,500.00
× Cost per direct labor hour 14.00 14.00 14.00
Total direct labor cost 147,000.00 315,000.00 175,000.00
Total
182,000.00
0.30
54,600.00
1,200.00
55,800.00
1,260.00
54,540.00
3.50
190,890.00 190,890.00

Total
182,000.00
8.00
1,456,000.00
48,000.00
1,504,000.00
50,400.00
1,453,600.00
0.05
72,680.00 72,680.00

Total
182,000.00
0.25
 45,500.00
14.00
637,000.00
Exercise 8-24

Enter the appropriate amounts in the gray-shaded cells. Some cells should be left blank.

Del Spencer's Men's Clothing Store

Schedule of Anticipated Cash Receipts
For the Months of August and September
Sales Amt. % on Credit % Collectib % w/Late C
Cash sales
Received from sales in:
June 55,000.00 0.90 0.14 1.03
July 45,000.00 0.90 0.65 1.00
45,000.00 0.90 0.14 1.03
August 56,000.00 0.90 0.15 1.00
56,000.00 0.90 0.65 1.00
September 83,000.00 0.90 0.15 1.00
Total cash receipts

Del Spencer's Men's Clothing Store

Schedule of Anticipated Cash Disbursements
For the Months of August and September
Purchases % on Credit % Payable net of disc
Paid from purchases in
July 21-31 22,500.00 1.00 0.33 0.98
July 01-20 22,500.00 1.00 0.67 1.00
August 21-31 28,000.00 1.00 0.33 0.98
August 01-20 28,000.00 1.00 0.67 1.00
Total cash receipts

Del Spencer's Men's Clothing Store

Schedule of Anticipated Cash Disbursements
For the Months of August and September
Purchases % on Credit % Payable net of disc
Paid from purchases in
21-Jun
1-Jul
21-Jul
1-Aug
11-Aug
 21-Aug
Total cash receipts
Name:

August September
5,600.00 8,300.00

7,137.90
26,325.00
5,840.10
7,560.00
32,760.00
11,205.00
46,622.90 58,105.10

Discount
August September July Purchases

7,350.00
15,000.00
9,146.67
18,666.67
22,350.00 27,813.33

July August
Ponderosa Company
Sales Budget
For the Quarter Ended Mar 31
Jan Feb Mar
Wiring harness
Units 10,000.00 10,500.00 13,000.00
x Unit price 110.00 110.00 110.00
Total Sales 1,100,000.00 1,155,000.00 1,430,000.00

Ponderosa Company
Production Budget
For the Quarter Ended Mar 31
Jan Feb Mar
Production budget
Unit sales 10,000.00 10,500.00 13,000.00
Desired ending inventory 2,100.00 2,600.00 3,200.00
Total needed 12,100.00 13,100.00 16,200.00
Less: Beginning inventory 900.00 2,100.00 2,600.00
Units to be produced 11,200.00 11,000.00 13,600.00

Ponderosa Company
Direct Materials Purchases Budget for Part #K298
For the Quarter Ended Mar 31

Jan Feb Mar

Units to be produced 11,200.00 11,000.00 13,600.00
× DM per unit 2.00 2.00 2.00
Production needs 22,400.00 22,000.00 27,200.00
Desired ending inventory 6,600.00 8,160.00 9,900.00
Total needed 29,000.00 30,160.00 37,100.00
Less: Beginning inventory 6,720.00 6,600.00 8,160.00
Direct materials to be purchased 22,280.00 23,560.00 28,940.00
× Cost per unit of #K298 4.00 4.00 4.00
Total purchase cost 89,120.00 94,240.00 115,760.00

Ponderosa Company
Direct Materials Purchases Budget for Part #C30
For the Quarter Ended Mar 31

Jan Feb Mar

Units to be produced 11,200.00 11,000.00 13,600.00
× DM per unit 3.00 3.00 3.00
Production needs 33,600.00 33,000.00 40,800.00
Desired ending inventory 9,900.00 12,240.00 14,850.00
Total needed 43,500.00 45,240.00 55,650.00
Less: Beginning inventory 10,080.00 9,900.00 12,240.00
Direct materials to be purchased 33,420.00 35,340.00 43,410.00
× Cost per unit of #K298 7.00 7.00 7.00
Total purchase cost 233,940.00 247,380.00 303,870.00

Ponderosa Company
Direct Labor Budget
For the Quarter Ended Mar 31

Jan Feb Mar

Units to be produced 11,200.00 11,000.00 13,600.00
× Direct labor time per unit (hours) 1.50 1.50 1.50
Direct labor hours needed 16,800.00 16,500.00 20,400.00
× Cost per direct labor hour 20.00 20.00 20.00
Total direct labor cost 336,000.00 330,000.00 408,000.00

Ponderosa Company
Overhead Budget
For the Quarter Ended Mar 31

Jan Feb Mar

Fixed Component
Maintenance 12,500.00 12,500.00 12,500.00
Supervision 14,000.00 14,000.00 14,000.00
Depreciation 45,000.00 45,000.00 45,000.00
Taxes 4,300.00 4,300.00 4,300.00
Others 86,000.00 86,000.00 86,000.00
Sub-total 161,800.00 161,800.00 161,800.00

Variable Component
Supplies 1.00 1.00 1.00
Power 0.20 0.20 0.20
Maintenance 1.10 1.10 1.10
Others 1.60 1.60 1.60
Total VC per hour 3.90 3.90 3.90
Multiply by DL Hours 16,800.00 16,500.00 20,400.00
Total Variable Costs 65,520.00 64,350.00 79,560.00
Total Monthly Overhead 227,320.00 226,150.00 241,360.00

Ponderosa Company
Selling & Administrative Expenses Budget
For the Quarter Ended Mar 31

Jan Feb Mar

Fixed Component
Salaries 88,500.00 88,500.00 88,500.00
Depreciation 25,000.00 25,000.00 25,000.00
Others 137,000.00 137,000.00 137,000.00
Sub-total 250,500.00 250,500.00 250,500.00

Variable Component
Commissions 1.40 1.40 1.40
Shipping 3.60 3.60 3.60
Others 1.60 1.60 1.60
Total VC per unit sold 6.60 6.60 6.60
Multiply by # of units sold 10,000.00 10,500.00 13,000.00
Total Variable S&A Expenses 66,000.00 69,300.00 85,800.00
Total Monthly Overhead 316,500.00 319,800.00 336,300.00

PRODUCT COST COMPUTATION:

Direct Materials Cost/unit of input Input Qty Cost/unit of output
- #K298 4.00 2.00 8.00
-#C30 7.00 3.00 21.00
Direct Labor 20.00 1.50 30.00
Factory Overhead
- Fixed 485,400.00 35,800.00 13.56
- Variable 3.90 1.50 5.85
Cost per unit 78.41
Ending Finished Goods Inventory (in units) end of the quarter 3,200.00
Ending Finished Goods Inventory 250,907.71

SCHEDULE OF COST OF GOODS SOLD

 Budgeted Manufacturing Cost
Direct Material Used
Part K29 8.00 35,800.00 286,400.00
Part C30 21.00 35,800.00 751,800.00
Direct Labor Used 30.00 35,800.00 1,074,000.00
Overhead 19.41 35,800.00 694,830.00
Total budgeted manufacturing costs 78.41 2,807,030.00
* Add: Finished Goods Inventory, Beginning 78.41 900.00 70,567.79
Budgeted Cost of Goods Available for Sale 2,877,597.79
Less: Finished Goods Inventory, End (Schedule 8) 250,907.71
Budgeted Cost of Goods Sold 2,626,690.08

* In the absence of the necessary information, it is assumed that

BUDGETED INCOME STATEMENT

Budgeted Sales 3,685,000.00
Less: Budgeted Cost of Goods Sold 2,626,690.08
Budgeted Gross Margin 1,058,309.92
Less: Budgeted S&A Expenses 972,600.00
Budgeted Income before taxes 85,709.92

CASH BUDGET January February March

Beginning Balance 62,900.00 30,020.00 25,450.00
Add: Cash Receipts 1,100,000.00 1,155,000.00 1,430,000.00
Total Cash Available 1,162,900.00 1,185,020.00 1,455,450.00
Less: Disbursements
Purchases 323,060.00 341,620.00 419,630.00
DL Payroll 336,000.00 330,000.00 408,000.00
Overhead 182,320.00 181,150.00 196,360.00
Selling & Admin 291,500.00 294,800.00 311,300.00
Land 68,000.00
Total Disbursements 1,132,880.00 1,215,570.00 1,335,290.00
Balance before financing activities 30,020.00 - 30,550.00 120,160.00
Financing activities
Borrowings* 56,000.00 - 56,000.00
Interest 560.00
Endiing Cash Balance 30,020.00 25,450.00 63,600.00

*Borrowings:
Minimum Cash Balance Requirement 25,000.00
Less: Cash balance before financing - 30,550.00
Minimum borrowing 55,550.00
In multiples of 1,000 56,000.00
 1st Q

33,500.00
110.00
3,685,000.00 3,685,000.00

Apr May 1st Q

16,000.00 18,500.00 33,500.00

3,700.00 3,200.00
19,700.00 36,700.00
3,200.00 900.00
16,500.00 35,800.00 35,800.00

Apr May 1st Q

16,500.00 35,800.00
2.00 2.00
33,000.00 71,600.00
9,900.00
81,500.00
6,720.00
74,780.00
4.00
299,120.00 299,120.00
Apr May 1st Q
16,500.00 35,800.00
3.00 3.00
49,500.00 107,400.00
14,850.00
122,250.00
10,080.00
112,170.00
7.00
785,190.00 785,190.00

Total
35,800.00
1.50
53,700.00
20.00
1,074,000.00 1,074,000.00

Total

485,400.00
 209,430.00
694,830.00 694,830.00

Total

751,500.00

221,100.00
972,600.00 972,600.00
Total
62,900.00
3,685,000.00
3,747,900.00

1,084,310.00
1,074,000.00
559,830.00
897,600.00
68,000.00
3,683,740.00
64,160.00

-
560.00
63,600.00
As of August

PURCHASES BUDGET ACTUAL

July August September October November
Sales 100,000.00 120,000.00 90,000.00
Cost + Mark up 1.33 1.33 1.33
Cost of Sales 75,000.19 90,000.23 67,500.17
Desired EI 36,000.09 36,000.09
Total 111,000.28 126,000.32
Less: Expected EI 30,000.08 36,000.09
Planned Purchases 81,000.20 90,000.23

ACCOUNTS PAYABLE 81,000.20

CEDIT SALES (80% of sales)

from June
from July
from August
AR-AUG
AR-NOV

PAYMENT OF PURCHASES

SCHEDULE OF CASH COLLECTIONS

December