Required information [The following information applies to the questions displayed below.] Morganton Company makes one product, and has provided the following information to help prepare the master budget for its first four months of operations: a. The budgeted selling price per unit is $70. Budgeted unit sales for June, July, August, and September are 8,500, 16,000, 18,000, and 19,000 units, respectively. All sales are on credit. b. Forty percent of credit sales are collected in the month of the sale and 60% in the following month. c. The ending finished goods inventory equals 20% of the following month's unit sales. d. The ending raw materials inventory equals 10% of the following month's raw materials production needs. Each unit of finished goods requires 5 kilograms of raw materials. The raw materials cost $2.00 per kilogram. e. Thirty percent of raw materials purchases are paid for in the month of purchase and 70% in the following month. f. The direct labour wage rate is $13 per hour. Each unit of finished goods requires two direct labour-hours. g. The variable selling and administrative expense per unit sold is $1.70. The fixed selling and administrative expense per month is $66,000. 2. What are the expected cash collections for July? Total cash collections
Required information [The following information applies to the questions displayed below.] Morganton Company makes one product, and has provided the following information to help prepare the master budget for its first four months of operations: a. The budgeted selling price per unit is $70. Budgeted unit sales for June, July, August, and September are 8,500, 16,000, 18,000, and 19,000 units, respectively. All sales are on credit. b. Forty percent of credit sales are collected in the month of the sale and 60% in the following month. c. The ending finished goods inventory equals 20% of the following month's unit sales. d. The ending raw materials inventory equals 10% of the following month's raw materials production needs. Each unit of finished goods requires 5 kilograms of raw materials. The raw materials cost $2.00 per kilogram. e. Thirty percent of raw materials purchases are paid for in the month of purchase and 70% in the following month. f. The direct labour wage rate is $13 per hour. Each unit of finished goods requires two direct labour-hours. g. The variable selling and administrative expense per unit sold is $1.70. The fixed selling and administrative expense per month is $66,000. 2. What are the expected cash collections for July? Total cash collections
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter8: Budgeting For Planning And Control
Section: Chapter Questions
Problem 6CE: Play-Disc makes Frisbee-type plastic discs. Each 12-inch diameter plastic disc has the following...
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![Required information
[The following information applies to the questions displayed below.]
Morganton Company makes one product, and has provided the following information to help prepare the master budget
for its first four months of operations:
a. The budgeted selling price per unit is $70. Budgeted unit sales for June, July, August, and September are 8,500,
16,000, 18,000, and 19,000 units, respectively. All sales are on credit.
b. Forty percent of credit sales are collected in the month of the sale and 60% in the following month.
c. The ending finished goods inventory equals 20% of the following month's unit sales.
d. The ending raw materials inventory equals 10% of the following month's raw materials production needs. Each unit of
finished goods requires 5 kilograms of raw materials. The raw materials cost $2.00 per kilogram.
e. Thirty percent of raw materials purchases are paid for in the month of purchase and 70% in the following month.
f. The direct labour wage rate is $13 per hour. Each unit of finished goods requires two direct labour-hours.
g. The variable selling and administrative expense per unit sold is $1.70. The fixed selling and administrative expense per
month is $66,000.
2. What are the expected cash collections for July?
Total cash collections](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F29dafe42-2450-44a8-bb10-5963eb33bfe3%2Fe1953155-01b1-4452-8fbd-c1b305b21e71%2Fo9xi7no_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Required information
[The following information applies to the questions displayed below.]
Morganton Company makes one product, and has provided the following information to help prepare the master budget
for its first four months of operations:
a. The budgeted selling price per unit is $70. Budgeted unit sales for June, July, August, and September are 8,500,
16,000, 18,000, and 19,000 units, respectively. All sales are on credit.
b. Forty percent of credit sales are collected in the month of the sale and 60% in the following month.
c. The ending finished goods inventory equals 20% of the following month's unit sales.
d. The ending raw materials inventory equals 10% of the following month's raw materials production needs. Each unit of
finished goods requires 5 kilograms of raw materials. The raw materials cost $2.00 per kilogram.
e. Thirty percent of raw materials purchases are paid for in the month of purchase and 70% in the following month.
f. The direct labour wage rate is $13 per hour. Each unit of finished goods requires two direct labour-hours.
g. The variable selling and administrative expense per unit sold is $1.70. The fixed selling and administrative expense per
month is $66,000.
2. What are the expected cash collections for July?
Total cash collections
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