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Review Problem: Budget Schedules Construct the sales budget Year 2 Quarter 3 Year 3 Quarter 1 1 4 2 Budgeted unit sales Selling price per unit Total sales ? ? ? ? ? ? ? ? ? ? Construct the schedule of expected cash collections Year 2 Quarter 2 1 3 4 Year Accounts receivable, beginning balance First-quarter sales Second-quarter sales Third-quarter sales Fourth-quarter sales ? ? ? ? ? Total cash collections ? ? ? ?

Review Problem: Budget Schedules Construct the sales budget Year 2 Quarter 3 Year 3 Quarter 1 1 4 2 Budgeted unit sales Selling price per unit Total sales ? ? ? ? ? ? ? ? ? ? Construct the schedule of expected cash collections Year 2 Quarter 2 1 3 4 Year Accounts receivable, beginning balance First-quarter sales Second-quarter sales Third-quarter sales Fourth-quarter sales ? ? ? ? ? Total cash collections ? ? ? ?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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**Review Problem: Budget Schedules** **Construct the sales budget** | | | Year 2 Quarter | | | | Year 3 Quarter | | |----------------------------|-----|----------------|-------|-------|-----|----------------|-------| | | | 1 | 2 | 3 | 4 | 1 | 2 | | Budgeted unit sales | ? | ? | ? | ? | ? | ? | ? | | Selling price per unit | ? | ? | ? | ? | ? | ? | ? | | Total sales | ? | ? | ? | ? | ? | ? | ? | **Construct the schedule of expected cash collections** | | | Year 2 Quarter | | | | Year | |----------------------------------------------|-----|----------------|-----|-----|-----|------| | | | 1 | 2 | 3 | 4 | | | Accounts receivable, beginning balance | ? | | | | | ? | | First-quarter sales | ? | | ? | | | ? | | Second-quarter sales | ? | | | ? | | ? | | Third-quarter sales | ? | | | | ? | ? | | Fourth-quarter sales | ? | | | | | ? | | Total cash collections | ? | | ? | ? | ? | ? | This table presents a budget schedule review problem. It involves constructing a sales budget and an expected cash collections schedule over various quarters. The specific figures for budgeted unit sales, selling price per unit, total sales, and cash collections are currently unknown and represented by question marks ('?'). The schedule covers four quarters in Year 2 and extends to the first two quarters of Year 3 for sales, while cash collections are summarized per quarter for Year 2 and as a total for the year.
Transcribed Image Text:**Review Problem: Budget Schedules** **Construct the sales budget** | | | Year 2 Quarter | | | | Year 3 Quarter | | |----------------------------|-----|----------------|-------|-------|-----|----------------|-------| | | | 1 | 2 | 3 | 4 | 1 | 2 | | Budgeted unit sales | ? | ? | ? | ? | ? | ? | ? | | Selling price per unit | ? | ? | ? | ? | ? | ? | ? | | Total sales | ? | ? | ? | ? | ? | ? | ? | **Construct the schedule of expected cash collections** | | | Year 2 Quarter | | | | Year | |----------------------------------------------|-----|----------------|-----|-----|-----|------| | | | 1 | 2 | 3 | 4 | | | Accounts receivable, beginning balance | ? | | | | | ? | | First-quarter sales | ? | | ? | | | ? | | Second-quarter sales | ? | | | ? | | ? | | Third-quarter sales | ? | | | | ? | ? | | Fourth-quarter sales | ? | | | | | ? | | Total cash collections | ? | | ? | ? | ? | ? | This table presents a budget schedule review problem. It involves constructing a sales budget and an expected cash collections schedule over various quarters. The specific figures for budgeted unit sales, selling price per unit, total sales, and cash collections are currently unknown and represented by question marks ('?'). The schedule covers four quarters in Year 2 and extends to the first two quarters of Year 3 for sales, while cash collections are summarized per quarter for Year 2 and as a total for the year.
**Budgeted Unit Sales and Financial Data Overview** This dataset provides a detailed overview of the budgeted unit sales and various financial parameters across different quarters. The data includes projections for Year 2 and Year 3, covering six quarters in total. ### Budgeted Unit Sales: - **Year 2 Quarter 1:** 40,000 units - **Year 2 Quarter 2:** 60,000 units - **Year 2 Quarter 3:** 100,000 units - **Year 2 Quarter 4:** 50,000 units - **Year 3 Quarter 1:** 70,000 units - **Year 3 Quarter 2:** 80,000 units ### Financial Information: - **Selling Price per Unit:** $12 - **Accounts Receivable:** Starting balance of $65,000 - **Sales Collection Patterns:** - 75% of sales are collected in the same quarter. - 25% of sales are collected in the following quarter. - **Finished Goods Inventory:** - Ending inventory aim is 30% of the next quarter's budgeted unit sales. - Beginning inventory starts at 12,000 units. - **Raw Materials:** - 5 pounds required per unit. - Desired ending inventory is 10% of the following quarter’s production needs. - Raw materials inventory at the start is 23,000 pounds. - Cost per pound is $0.80. - Payment for purchases: 60% in the purchase quarter, 40% in the subsequent quarter. - Accounts Payable for raw materials starts at $81,500. ### Labor and Overhead: - **Direct Labor:** - Cost is $15 per hour. - 0.2 hours required per unit. - **Manufacturing Overhead (MOH):** - Variable rate: $2 per hour. - Fixed cost: $60,000. - **Selling, General, & Administrative (S&A) Expenses:** - Variable rate: $1.80 per unit. ### Financial Requirements: - **Minimum Cash Balance:** $50,000 - **Annual Interest Rate:** 12% This data plays a crucial role in planning production and financial strategies, ensuring adequate resource allocation, and maintaining a healthy cash flow to meet operational goals.
Transcribed Image Text:**Budgeted Unit Sales and Financial Data Overview** This dataset provides a detailed overview of the budgeted unit sales and various financial parameters across different quarters. The data includes projections for Year 2 and Year 3, covering six quarters in total. ### Budgeted Unit Sales: - **Year 2 Quarter 1:** 40,000 units - **Year 2 Quarter 2:** 60,000 units - **Year 2 Quarter 3:** 100,000 units - **Year 2 Quarter 4:** 50,000 units - **Year 3 Quarter 1:** 70,000 units - **Year 3 Quarter 2:** 80,000 units ### Financial Information: - **Selling Price per Unit:** $12 - **Accounts Receivable:** Starting balance of $65,000 - **Sales Collection Patterns:** - 75% of sales are collected in the same quarter. - 25% of sales are collected in the following quarter. - **Finished Goods Inventory:** - Ending inventory aim is 30% of the next quarter's budgeted unit sales. - Beginning inventory starts at 12,000 units. - **Raw Materials:** - 5 pounds required per unit. - Desired ending inventory is 10% of the following quarter’s production needs. - Raw materials inventory at the start is 23,000 pounds. - Cost per pound is $0.80. - Payment for purchases: 60% in the purchase quarter, 40% in the subsequent quarter. - Accounts Payable for raw materials starts at $81,500. ### Labor and Overhead: - **Direct Labor:** - Cost is $15 per hour. - 0.2 hours required per unit. - **Manufacturing Overhead (MOH):** - Variable rate: $2 per hour. - Fixed cost: $60,000. - **Selling, General, & Administrative (S&A) Expenses:** - Variable rate: $1.80 per unit. ### Financial Requirements: - **Minimum Cash Balance:** $50,000 - **Annual Interest Rate:** 12% This data plays a crucial role in planning production and financial strategies, ensuring adequate resource allocation, and maintaining a healthy cash flow to meet operational goals.
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