Big Watches Co. makes one product and it provided the following information to help prepare the master budget for its first four months of operations: The budgeted selling price per unit is $81. Budgeted unit sales for September, October, November, and December are 20,000, 21,000, 18,000, and 19,000 units, respectively. All sales are on credit. 35% of credit sales are collected in the month of the sale and 65% in the following month. The ending finished goods inventory equals 15% of the following month’s unit sales. The ending raw materials inventory equals 26% of the following month’s raw materials production needs. Each unit of finished goods requires 13 pounds of raw materials. The raw materials cost $11.00 per pound. 25% of raw materials purchases are paid for in the month of purchase and 75% in the following month. What is the accounts receivable balance at the start of December? Round your answer to the nearest whole number.
Big Watches Co. makes one product and it provided the following information to help prepare the master budget for its first four months of operations: The budgeted selling price per unit is $81. Budgeted unit sales for September, October, November, and December are 20,000, 21,000, 18,000, and 19,000 units, respectively. All sales are on credit. 35% of credit sales are collected in the month of the sale and 65% in the following month. The ending finished goods inventory equals 15% of the following month’s unit sales. The ending raw materials inventory equals 26% of the following month’s raw materials production needs. Each unit of finished goods requires 13 pounds of raw materials. The raw materials cost $11.00 per pound. 25% of raw materials purchases are paid for in the month of purchase and 75% in the following month. What is the accounts receivable balance at the start of December? Round your answer to the nearest whole number.
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter9: Profit Planning And Flexible Budgets
Section: Chapter Questions
Problem 72P: Cash Budget The controller of Feinberg Company is gathering data to prepare the cash budget for...
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Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
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Big Watches Co. makes one product and it provided the following information to help prepare the
- The budgeted selling price per unit is $81. Budgeted unit sales for September, October, November, and December are 20,000, 21,000, 18,000, and 19,000 units, respectively. All sales are on credit.
- 35% of credit sales are collected in the month of the sale and 65% in the following month.
- The ending finished goods inventory equals 15% of the following month’s unit sales.
- The ending raw materials inventory equals 26% of the following month’s raw materials production needs. Each unit of finished goods requires 13 pounds of raw materials. The raw materials cost $11.00 per pound.
- 25% of raw materials purchases are paid for in the month of purchase and 75% in the following month.
What is the
Round your answer to the nearest whole number.
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