1 .

2.

[The following information applies to .. the que.stions displayed below.]""

Midwest Products is a wholesale distributor of leaf rakes. Thus, peak sales occur in August of each year as shown in the company's sales budget for the third quarter, given below:

Budgeted sales (all on account) July

$600,000 August

$ 900,000 September $500,000

Total $2,000,000

From past experience, the company has learned that 20% of a month's sales are collected in the month of sale, another 70% are collected in the month following sale, and the remaining 10% are collected in the second month following sale. Bad debts are negligible and can be ignored. May sales totaled $430,000 , and June sales totaled $540,000.

value: 10.00 points

Required: 1. Prepare a schedule of expected cash collections from sales, by month and in total, for the third

quarter. (Do not round intermediate calculations. Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.)

value:

May sales June sales July sales August sales

September sales

Total cash collections

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10.00 points

Schedule of Expected Cash Collections July August September

$ :=1 ==43=oo=:o l $ 1 o l $ I o l 378000 54000 I o I 120000 420000 . 60000

1-----~--~l 18000~ I ~~~~~~ 541000 1 654000 1 790000 1

View Hint #1 1 ~ 1 references

Total $1 43ooo I l=====l

432000 600000 810000 100000

1985000 1

... i Assu.me thaftFie.co.mi:iany. wilfprepare abud9.eted &aiance.sh.eetas of september 3o: comi:iute.the accounts receivable as of that date. (Do not round intermediate calculations. Omit the "$" sign in your response.)

Total accounts receivable $ 1.__4...:....:9--=--oo::....::..o.:....Jo I

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3. value: 10.00 points ttie direct 1abor bud9et a Krlspln corporation tor. the i.ipcomln9 fiscal year inCludes thefoilowing ............................................................................................................................... .

budgeted direct labor-hours.

Budgeted direct labor-hours 1st Quarter

5,000 2nd Quarter

4,800 3rd Quarter

5,200 4th Quarter

5,400

The company's variable manufacturing overhead rate is $1.75 per direct labor-hour and the company's fixed manufacturing overhead is $35,000 per quarter. The only noncash item included in fixed manufacturing overhead is depreciation, which is $15,000 per quarter.

Required:

1. Complete the company's manufacturing overhead budget for the upcoming fiscal year. (Input all amounts as positive values. Omit the "$" sign in your response.)

Krispin Corporation Manufacturing Overhead Budget

1st 2nd 3rd Quarter Quarter Quarter

Variable manufacturing overhead $ 8750 $ 8400 $ 9100

Fixed manufacturing overhead 35000 35000 35000

Total manufacturing overhead 43750 1 43400 1 44100 1 Less depreciation 15000 1 15000 1 15000 1

Cash disbursements for $ 1 28750 1 $ 1 28400 1 $ 1 29100 1 manufacturing overhead

2. Compute the company's manufacturing overhead rate (including both variable and fixed manufacturing overhead) for the upcoming fiscal year. (Round your answer to 2 decimal places. Omit the "$" sign in your response.)

Predetermined manufacturing overhead rate $ .L-1 __ 8_.6___.1 1

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4th Quarter

$ 9450 1--------l

35000

44450 1

15000 1

$ ,_1 ---=2=-=-94--=5..:....~0 1

Year $ 35700 1--------l

140000

175700 1

60000 1

$ ,_1 _ _:_:11_:_:5 7--=-o~o 1

4. value: 10.00 points - . ..... ..... ..... ..... ....................... ......... . ............. .... ................... ..... ..... ..... ..... ......... " . ..... .......... ................. ..... ..... .... ......... ........... ... . ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... ..... .... -

The budgeted unit sales of Haerve Company for the upcoming fiscal year are provided below:

Budgeted unit sales 1st Quarter

12,000 2nd Quarter

14,000 3rd Quarter

11 ,000 4th Quarter

10,000

The company's variable selling and administrative expenses per unit are $2.75. Fixed selling and administrative expenses include advertising expenses of $12,000 per quarter, executive salaries of $40,000 per quarter, and depreciation of $16,000 per quarter. In addition,. the company will make insurance payments of $6,000 in the 2nd Quarter and $6,000 in the 4th Quarter. Finally, property taxes of $6,000 will be paid in the 3rd Quarter.

Required: Prepare the company's selling and administrative expense budget for the upcoming fiscal year. (Input all amounts as positive values. Leave no cells blank be certain to enter "0" wherever required. Omit the"$" sign in your response.)

Haerve Company Selling and Administrative Expense Budget

1st 2nd Quarter Quarter

I Variable selling and administrative expenses I $ 1 33000 1 $ 1 38500 1 Fixed selling and administrative expenses:

Advertising 12000 12000 Executive salaries 40000 40000 Insurance 0 6000 Property taxes 0 0 Depreciation 16000 16000

Total fixed selling and administrative expenses 68000 1 74000 1

Total selling and administrative expenses 101000 1 112500 1

I Less depreciation I 16000 1 16000 1 Cash disbursements for selling and administrative expenses $ 1 85ooo l $ 1 96500 1

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3rd 4th Quarter Quarter Year

$ 1 30250 1 $ 1 27500 1 $ 1 129250 1

12000 12000 48000

40000 40000 160000

0 6000 12000

6000 0 6000

16000 16000 64000

74000 1 74000 1 290000 1

104250 1 101500 1 419250 1

16000 1 16000 1 64000 1

$ 1 88250 1 $ 1 855oo l $ 1 355250 1

5. value: 10.00 points ........................................................................................................................................................................................... ....................................................................................

Micro Products, Inc., has developed a very powerful electronic calculator. Each calculator requires three small "chips" that cost $2 each and are purchased from an overseas supplier. Micro Products has prepared a production budget for the calculator by quarters for Year 2 and for the fi rst quarter of Year 3, as shown below:

Year2 First Second Third Fourth

Budgeted production, in calculators 60,000 90,000 150,000 100,000

Year3 First

80,000

The chip used in production of the calculator is sometimes hard to get, so it is necessary to carry large inventories as a precaution against stockouts. For this reason, the inventory of chips at the end of a quarter must equal 20% of the following quarter's production needs. A total of 36,000 chips will be on hand to start the fi rst quarter of Year 2.

Required : Prepare a direct materials budget for chips, by quarter and in total, for Year 2. (Do not round intermediate calculations. Input all amounts as positive values. Omit the "$" sign in your response.)

Micro Products, Inc. Direct Materials Budget- Year 2

Quarter First Second

Required production in calculators 6oooo l I 90000 1 Number of chips per calculator X 3 3

Production needs- chips 270000

j Add I: I Ending inventory I 90000 1

Total needs 234000 1 360000 1

I Deduct I: I Beginning inventory I 36000 1 54000 1 Required purchases- chips 198000 1 306000 1

Total cost of purchases $1 396000 1 $ 1 612000 1 $ I

Third Fourth Year 150ooo l 100000 1 400000 1

3 3 3 1 300000 1200000

48000 1 48000 1

510000 1 348000 1 1248000 1

90000 1 6oooo l 36000 1

420000 1 288000 1 1212000 1

840000 1 $1 576000 1 $ 1 2424000 1

6. value: 10.00 points ciystai tefecom .. has bui:lgetecfthe saies ofhs innovative mobWe phone over the nexftour mori.ths as follows:

July August September October

Sales in Units 30,000 45,000 60,000 50,000

The company is now in the process of preparing a production budget for the third quarter. Past experience has shown that end-of-month finished goods inventories must equal 10% of the next month's sales. The inventory at the end of June was 3,000 units.

Required: Prepare a production budget for the third quarter showing the number of units to be produced each month and for the quarter in total. (Do not round intermediate calculations. Input all amounts as positive values.)

Crystal Telecom Production Budget

Jul~ August Se~tember Budgeted sales in units 30000 1 45000 1 60000 1 j Add ~ 1: I Ending inventory ~ I 4500 1 6ooo l 5ooo l

Total needs 34500 1 51000 1 65000 1

I Deduct ~ 1: I Beginning inventory ~ I 3000 1 4500 1 6ooo l Required production in units 31500 1 46500 1 59000 1

Quarter 135000 1

5ooo l

140000 1 3000 1

137000 1

7. value: 10.00 points seattle caCis the wholes

8. value: 10.00 points Colerain Corporation is a merchandising company that is preparing a profit plan for the third quarter of the calendar year. The company's balance sheet as of June 30 is shown below:

Cash

Colerain Corporation Balance Sheet

June 30 Assets

Accounts receivable Inventory Plant and equipment, net of depreciation

Total assets

Liabilities and Stockho