Answer Happy

Part 1 I have a template set up on the Budgetsolution worksheet that you should use to complete the required budgets and requirements stated below. You need to use cell references in the development of your budgets. You will earn zero credit if you type in the numbers and do not use cell referencing. You should use this worksheet as your data field and only use cell references and formulas in your budgets. Your grade will be based on accuracy of your solution and correct usage of excel. The budget worksheet has formatted budgets for you to complete. The beauty behind excel is that managers can perform what-if analysis just by changing the data, so you do not need to retype the budgets if you have used cell references and formulas throughout. Data Scenario: You have just been hired into a management position which requires the application of your budgeting skills. You find out that budgeting has not been a priority of the company. You have contacted various areas on the organization and have accumulated the information below to assist you in preparing a comprehensive budget. Manufacturing Inc. produces a part used in the production of engines. Actual Sales and Projected sales in units: March (Actual) 38,000 April 40,000 May 42,000 June 45,000 July 44,000 Sales are the following type: 51% Cash sales collected in month of sale 49% Credit sales collected in the following month of sale The following data pertains to the manufacturing process. 1. Finished goods inventory March 31st 32,000 units $148.71 budgeted cost to make a unit Desired ending finished goods for each month 80% of next month's sales volume 2. Direct materials used: Direct Material Cost per Pound Per-Unit Usage 8 pounds Metal The beginning balance of each month needs to be able to produce Beginning material in pounds as of April 1st 48% of that month's estimated sales volume 153,600 Direct materials paid in month purchased. 4 hours $14.00 per hour 3. The direct labor used per unit Direct labor paid in month incurred. 4. Overhead each month is estimated based on direct labor hours per variable cost. All costs that use cash are paid in month incurred. Fixed cost Variable cost Supplies $0.80 $7
4. Overhead each month is estimated based on direct labor hours per variable cost. All costs that use cash are paid in month incurred. Fixed cost Variable cost Supplies Power $0.80 0.60 Maintenance 0.40 $20,000 15,000 Supervision Depreciation 19,000 Taxes 11,000 $65,000 Total $1.80 5. Monthly selling and administrative expenses are based on units sold per variable cost. All costs that use cash are paid in month incurred. Fixed cost Variable cost Salaries $30,000 $1 Commissions Depreciation Shipping Total 0.7 $1.70 6. Unit selling price $200 Iper unit 7. Cash balance as of April 1st $60,000 Required: You must use cell references on the BudgetSolution worksheet, by referencing this worksheet that contains the data. Prepare the following second quarter budgets and answer the questions listed on the template provided on the BudgetSolution Worksheet. I have adapted the budget model to meet the needs of this company. If I bolded a line item, that is a header and does not need computation on that row. Please note the quarter column is for the quarter so not all lines should be added across in the quarter column. When you have beginning and ending inventory or cash balances this is for the quarter and should be brought over to the quarter column. 1. Sales Budget per month and quarter. 2. Production Budget per month and quarter. 3. Direct materials purchase budget per month and quarter. 4. Manufacturing Cost budget per month and quarter. 5. Selling and administrative expenses budget per month and quarter. 6. Cash budget per month and quarter. 7. Budgeted income statement (ignore income tax) for the quarter. 8. What if the company decides to lay off one of the part-time administrative staff. The monthly salaries will be reduced by $5,000, list all budgets that will change? Why? What is the New Net income(Loss) for the quarter? 10,000 $40,000
#6 Cash Budget Manufacturing Inc. Cash Budget For quarter ended June 30, 20XX May June Beginning cash Add Cash Collections of Sales: Cash sales collected in month sale Credit sales Collected in following month Total Cash receipts Cash Available Less Cash Disbursements: Purchases (Budget 3) Direct Labor (Budget 4) Overhead that uses cash Selling and administrative expenses that use cash Total Cash Disbursements Ending Cash #7 Budgeted Income statement for Second quarter Manufacturing Inc. Budgeted Income Statement For the Secord Quarter ended June 30, 20XX Sales (Budget #1) Cost of Goods Sold: Beginning Finished Goods Total Manufacturing Costs (Budget #4) Cost of Goods Available for Sale Ending finished goods Budgeted Cost of Goods Sold Gross Profit Less: Selling and administrative expenses (Budget 5) Income before income taxes #8 What if the company decides to lay off one of the part-time administrative staff. The monthly salaries will be reduced by $5,000, list all budgets that will change? Why? What is the New Net income(Loss) for the quarter? If you have linked everything correctly, you should only have to change the monthly salary on the data sheet. Please change the salary back to the original amount of before you submit ◄ ► Project4_Intro Part1 BudgetSolution Part 2 Part 3 Part 4 + ⠀ April Quarter