Madonna Company is preparing its Master Budget for 2022. Budget information are as follows: Production Cost Operating Expenses P192,000 Sales P64,000 2022 First quarter Second quarter Third quarter Fourth quarter P280,000 320,000 200,000 68,000 360,000 224,000 72,000 352,000 200,000 76,000 2023 First quarter 320,000 224,000 72,000 The budgeted finished goods inventories are: P 56,000 52,000 60,000 48,000 2021: March 31 June 30 September 30 December 31 The company uses the JIT system on its purchase of materials. It buys materials on cash basis. Included in production cost cach quarter is P 44,000 in depreciation. The operating expenses include depreciation of P 12,000 per quarter. All production costs and operating expenses, with the exemption of depreciation are to be paid during the quarter of incurrence. Collections on sales are planned at 60% during the quarter of sales, the balance during the quarter following the sale. Dividends of P 20,000 are to be paid in June and again in December if covered by sufficient profits. No dividends will be paid if the net profit is less than P 120,000. Income tax is equal to 32% of the quarter's income before tax and is paid in the following quarter. The company's balance sheet as of December 31,2021 is as follows: Madonna Company Balance Sheet December 31, 2021 Assets Equities Cash P 76,000 P 12,000 Income tax payable Accounts receivable, net Inventory Plant and equipment, net 120,000 44,000 580,000 P 820,000 Capital stock Retained Earnings Total cquity 640,000 168,000 P 820,000 Total assets
Madonna Company is preparing its Master Budget for 2022. Budget information are as follows: Production Cost Operating Expenses P192,000 Sales P64,000 2022 First quarter Second quarter Third quarter Fourth quarter P280,000 320,000 200,000 68,000 360,000 224,000 72,000 352,000 200,000 76,000 2023 First quarter 320,000 224,000 72,000 The budgeted finished goods inventories are: P 56,000 52,000 60,000 48,000 2021: March 31 June 30 September 30 December 31 The company uses the JIT system on its purchase of materials. It buys materials on cash basis. Included in production cost cach quarter is P 44,000 in depreciation. The operating expenses include depreciation of P 12,000 per quarter. All production costs and operating expenses, with the exemption of depreciation are to be paid during the quarter of incurrence. Collections on sales are planned at 60% during the quarter of sales, the balance during the quarter following the sale. Dividends of P 20,000 are to be paid in June and again in December if covered by sufficient profits. No dividends will be paid if the net profit is less than P 120,000. Income tax is equal to 32% of the quarter's income before tax and is paid in the following quarter. The company's balance sheet as of December 31,2021 is as follows: Madonna Company Balance Sheet December 31, 2021 Assets Equities Cash P 76,000 P 12,000 Income tax payable Accounts receivable, net Inventory Plant and equipment, net 120,000 44,000 580,000 P 820,000 Capital stock Retained Earnings Total cquity 640,000 168,000 P 820,000 Total assets
Chapter8: Budgets And Bank Reconciliations
Section: Chapter Questions
Problem 4.1C
Related questions
Question
- How much was the actual sales during the last quarter of 2021?
- What is the total budgeted cost of goods sold for the year 2022?
- How much dividends will be paid in 2022?
- What is the total budgeted cash disbursements for production costs and operating expenses for the
year 2022? - What is the budgeted cash balance on December 31, 2022?
- What is the expected balance of
accounts receivable as of December 31, 2022? - What is the budgeted balance of raw materials inventory as of December 31, 2022?
- What is the expected balance of income tax payable as of December 31, 2022?
- What is the budgeted balance of
retained earnings as of December 31, 2022? - What is the expected balance of the plant and equipment accounts as of December 31, 2022?
- If a budgeted balance sheet as of December 31, 2022 is to be prepared, how much will be the total assets?
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