Caleb Cannon

ACCT 2020
Spring 2016
Budget Assignment

MANAGERIAL ACCOUNTING - Fourth Edition

WASATCH MANUFACTURING
Master Budget

Sales Budget
January
February
March
April
7000
8000
9000
8600
9400
15 $
15 $
15 $
15 $
15 $
105,000 $ 120,000 $ 135,000 $ 129,000 $ 141,000 $

December
Unit Sales
Price per Unit
Sales Revenue

$
$

Cash sales
Credit sales
Total cash collections

Unit sales
Plus: Desired ending inventory
Total needed
Less: Beginning inventory
Units to produce

Chapter 9: The Master Budget

Cash Collections Budget

January
February
$ 36,000 $ 40,500
$ 73,500 $ 84,000
$ 109,500 $ 124,500

Production Budget
January
8000
1800
9800
1600
8200

February
9000
1720
10720
1800
8920

March
$ 38,700
$ 94,500
$ 133,200

March
8600
1880
10480
1720
8760

May
6800
15
102,000

Quarter
$ 115,200
$ 252,000
$ 367,200

Quarter
25600
1880
27480
1600
25880

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MANAGERIAL ACCOUNTING - Fourth Edition

Direct Materials Budget

January
February
March
Quarter
Units to be produced
8200
8920
8760
25880
Multiply by: Quantity of DM needed per unit
4
4
4
4
Quantity of DM needed for production (lbs.)
32800
35680
35040
103520
Plus: Desired ending inventory of DM (lbs.)
5352
5256
5328
5328
Total quantity of DM needed (lbs.)
38152
40936
40368
108848
Less: Beginning inventory of DM (lbs.)
4920
5352
5256
4920
Quantity of DM to purchase (lbs.)
33232
35584
35112
103928
Multiply by: Cost per pound
$
1 $
1 $
1 $
1
Total cost of DM purchases
$ 33,232 $ 35,584 $ 35,112 $ 103,928

Cash Payments for Direct Material Purchases Budget

January
February
March
December Purchases (from A/P)
$ 37,000
January Purchases
$
6,646 $ 24,924
February Purchases
$
7,117 $ 26,688
March Purchases
$
8,778
Total Cash Payments
$ 43,646 $ 32,041 $ 35,466

Caleb Cannon
ACCT 2020
Spring 2016
Budget Assignment

Quarter
$ 37,000
$ 31,570
$ 33,805
$
8,778
$ 111,153

Cash Payments for Direct Labor Budget

January
February
March
Quarter
Units Produced
8200
8920
8760
25880
Multiply by: Hours per Unit
0.1
0.1
0.1
0.1
Direct Labor Hours
820
892
876
2588
Multiply by: Direct Labor Rate per Hour
$
15 $
15 $
15 $
15
Direct Labor Cost
$ 12,300 $ 13,380 $ 13,140 $ 38,820

Chapter 9: The Master Budget

Page 2 of 4

Caleb Cannon
ACCT 2020
Spring 2016
Budget Assignment

MANAGERIAL ACCOUNTING - Fourth Edition

Cash Payments for Manufacturing Overhead Budget

January
February
March
Rent (fixed)
$ 10,000 $ 10,000 $ 10,000
Other Manufacturing Overhead (fixed)
$
6,000 $
6,000 $
6,000
Variable Manufacturing Overhead Costs
$ 10,250 $ 11,150 $ 10,950
Cash Payments for Manufacturing Overhead $ 26,250 $ 27,150 $ 26,950

$
$
$
$

Quarter
30,000
18,000
32,350
80,350

Cash Payments for Operating Expenses Budget

January
February
March
Variable Operating Expenses
$ 10,400 $ 11,700 $ 11,180
Fixed Operating Expenses
$
2,200 $
2,200 $
2,200
Cash Payments for Operating Expenses
$ 12,600 $ 13,900 $ 13,380

$
$
$

Quarter
33,280
6,600
39,880

Cash Balance, Beginning

Plus: Cash Collections
Total Cash Available
Less Cash Payments:
DM Purchases
Direct Labor
Manufacturing Overhead costs
Operating Expenses
Tax Payment
Equipment Purchases
Total Cash Payments
Ending Cash before Financing
Financing:
Borrowings
Repayments
Interest Payments
Cash Balance, Ending

Chapter 9: The Master Budget

Combined Cash Budget

January
February
$ 17,000 $ 15,704
$ 109,500 $ 124,500
$ 126,500 $ 140,204
$
$
$
$

43,646
12,300
26,250
12,600

$ 20,000
$ 114,796
$ 11,704
$

$ 32,041
$ 13,380
$ 27,150
$ 13,900
$ 28,000
$
8,000
$ 122,471
$ 17,733

Quarter
$ 17,000
$ 367,200
$ 384,200

$
$
$
$

$ 111,153
$ 38,820
$ 80,350
$ 39,880
$ 28,000
$ 53,000
$ 351,203
$ 32,997

35,466
13,140
26,950
13,380

$ 25,000
$ 113,936
$ 34,997

4,000
$

$
$

March
$ 15,733
$ 133,200
$ 148,933

4,000
15,704

$
$

(2,000) $
$
(2,000) $
15,733 $

(2,000)
(150)
(2,150)
32,847

$
$
$
$
$

4,000
(4,000)
(150)
(150)
32,847

Page 3 of 4

Caleb Cannon
ACCT 2020
Spring 2016
Budget Assignment

MANAGERIAL ACCOUNTING - Fourth Edition

Budgeted Manufacturing Cost per Unit

Direct materials cost per unit
Direct labor cost per unit
Variable manufacturing costs per unit
Fixed manufacturing overhead per unit
Cost of manufacturing each unit

Budgeted Income Statement

Sales Revenue
Less: Cost of Goods Sold
Gross Profit
Less: Operating Expenses
Less: Depreciation Expense
Operating Income
Less: Interest Expense
Less: Income Tax Expense
Net Income

Chapter 9: The Master Budget

$
$
$
$
$

$
$
$
$
$
$
$
$
$

4.00
1.50
1.30
0.75
7.55

384,000
(193,280)
190,720
(39,880)
(10,000)
140,840
(150)
(32,428)
108,262

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