The Acme Company is a manufacturer of coffee tables. Acme has two product lines: the Family Room (FR) table (a larger ta

[answerhappygod]

The Acme Company is a manufacturer of coffee tables. Acme has
two product lines: the Family Room (FR) table (a larger table) and
the Living Room (LR) table (a smaller table built with more
expensive wood). The primary raw materials are wood, glass table
top sheets, and decorative knobs. Each FR table requires ten feet
of wood and the LR table requires eight feet of a more expensive
wood. Acme makes both FR and LR table tops out of the same
glass sheets but there is more waste when making LR table tops.
Each FR table requires five decorative knobs and the LR table
requires only three decorative knobs. Other raw materials, such as
screws and glue, are insignificant in cost and are treated as
indirect material.
Acme’s controller is preparing the annual master budget for 2021
and has gathered the following information:
1st Quarter
2nd Quarter
3rd Quarter
4th Quarter
Entire Year
Indirect Material
$327,532
$353,750
$382,100
$412,500
$1,475,882
Indirect labor
848,300
916,200
989,400
1,060,000
3,813,900
Depreciation
510,000
510,000
510,000
510,000
2,040,000
Other overhead
565,432
740,114
907,364
1,075,164
3,288,074
Total Overhead
$2,251,264
$2,520,064
$2,788,864
$3,057,664
$10,617 ,856
All of these costs will be paid in cash, except for
depreciation.
Direct material:
Wood:
FR table 10 feet @ $12 per foot
LR table 8 feet @ $16 per
foot
Glass Sheets:
FR table 1 sheet @$9 per sheet
LR table 1 sheet @$9 per sheet
Decorative Knobs:
FR table 5 knobs @ $0.24 per knob
LR table 3 knobs @ $0.24 per knob
Direct Labor: .
FR table 2.2 hours at $21 per direct
labor hour
LR table 3.4 hours at $24 per direct
labor hour
Manufacturing
overhead: $8 per direct labor hour.
11. The company is planning to
purchase new machinery to make the production process more
efficient. The machinery will cost $15,000,000 and they plan to
finance the purchase with a five year loan from Rockland bank. On
January 2, 2021, they will receive the proceeds of the loan and
purchase and begin operating the machinery. The loan will be repaid
in 20 equal principle installments on the last day of each quarter.
The interest rate will be 6% per year and the interest payments
will be made on the last day of each quarter as well.
12. Acme’s balance sheet as of
December 31, 2020 will be as follows:
Cash
$446,200
Accounts Payable
$1,793,344
Accounts receivable
7,376,938
Total Liabilities
1,793,344
Inventory:
Common Stock
50,050,000
Raw Materials
0
Retained Earnings
41,994,317
Finished Goods
6,014,523
Total Stockholders Equity
92,044,317
Plant & Equipment (net of Accumulated Depreciation
80,000,000
Total Liabilities and Stockholders Equity
$93,837,661
Total Assets
$93,837,661
Required:
In your role as Acme’s budget
director, after receiving input from the various department heads,
prepare the Acme company annual Master Budget for 2021 by
completing the following quarterly schedules (with annual totals
shown for 2021).
Important: You will need to do a 2020
fourth quarter schedule for several of the items below in order to
budget out the 2021 amounts:
Questions:
2)Prepare a Quarterly summary cash receipts and disbursements
budget for 2021 (cash budget).
1)Prepare a budgeted Schedule of cost of goods manufactured and
a budgeted Schedule of cost of goods sold for 2021 (Hint: actual
and applied overhead will be equal).