The Foundational 15 (Algo) [LO8-2, LO8-3, LO8-4, LO8-5, LO8-7, LO8-9, LO8-10] [The following information applies to the questions displayed below.] Morganton Company makes one product and it provided the following information to help prepare the master budget: a. The budgeted selling price per unit is $65. Budgeted unit sales for June, July, August, and September are 9,000, 21,000, 23,000, and 24,000 units, respectively. All sales are on credit. b. Thirty percent of credit sales are collected in the month of the sale and 70% in the following month. c. The ending finished goods inventory equals 30% of the following month's unit sales. d. The ending raw materials inventory equals 20% of the following month's raw materials production needs. Each unit of finished goods requires 5 pounds of raw materials. The raw materials cost $2.70 per pound. e. Twenty percent of raw materials purchases are paid for in the month of purchase and 80% in the following month. f. The direct labor wage rate is $14 per hour. Each unit of finished goods requires two direct labor- hours. g. The variable selling and administrative expense per unit sold is $1.60. The fixed selling and administrative expense per month is $60,000. Foundational 8-3 (Algo) 3. What is the accounts receivable balance at the end of July? Accounts receivable
The Foundational 15 (Algo) [LO8-2, LO8-3, LO8-4, LO8-5, LO8-7, LO8-9, LO8-10] [The following information applies to the questions displayed below.] Morganton Company makes one product and it provided the following information to help prepare the master budget: a. The budgeted selling price per unit is $65. Budgeted unit sales for June, July, August, and September are 9,000, 21,000, 23,000, and 24,000 units, respectively. All sales are on credit. b. Thirty percent of credit sales are collected in the month of the sale and 70% in the following month. c. The ending finished goods inventory equals 30% of the following month's unit sales. d. The ending raw materials inventory equals 20% of the following month's raw materials production needs. Each unit of finished goods requires 5 pounds of raw materials. The raw materials cost $2.70 per pound. e. Twenty percent of raw materials purchases are paid for in the month of purchase and 80% in the following month. f. The direct labor wage rate is $14 per hour. Each unit of finished goods requires two direct labor- hours. g. The variable selling and administrative expense per unit sold is $1.60. The fixed selling and administrative expense per month is $60,000. Foundational 8-3 (Algo) 3. What is the accounts receivable balance at the end of July? Accounts receivable
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Concept explainers
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.
Question
![The Foundational 15 (Algo) [LO8-2, LO8-3, LO8-4, LO8-5, LO8-7, LO8-9, LO8-10]
[The following information applies to the questions displayed below.]
Morganton Company makes one product and it provided the following information to help prepare
the master budget:
a. The budgeted selling price per unit is $65. Budgeted unit sales for June, July, August, and
September are 9,000, 21,000, 23,000, and 24,000 units, respectively. All sales are on credit.
b. Thirty percent of credit sales are collected in the month of the sale and 70% in the following
month.
c. The ending finished goods inventory equals 30% of the following month's unit sales.
d. The ending raw materials inventory equals 20% of the following month's raw materials
production needs. Each unit of finished goods requires 5 pounds of raw materials. The raw
materials cost $2.70 per pound.
e. Twenty percent of raw materials purchases are paid for in the month of purchase and 80% in the
following month.
f. The direct labor wage rate is $14 per hour. Each unit of finished goods requires two direct labor-
hours.
g. The variable selling and administrative expense per unit sold is $1.60. The fixed selling and
administrative expense per month is $60,000.
Foundational 8-3 (Algo)
3. What is the accounts receivable balance at the end of July?
Accounts receivable](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F5b198320-74f0-409b-aab0-fde615ca8bfb%2Fc430954f-16a4-4ed3-a961-1428b8fa6f36%2Fwpxpkyo_processed.png&w=3840&q=75)
Transcribed Image Text:The Foundational 15 (Algo) [LO8-2, LO8-3, LO8-4, LO8-5, LO8-7, LO8-9, LO8-10]
[The following information applies to the questions displayed below.]
Morganton Company makes one product and it provided the following information to help prepare
the master budget:
a. The budgeted selling price per unit is $65. Budgeted unit sales for June, July, August, and
September are 9,000, 21,000, 23,000, and 24,000 units, respectively. All sales are on credit.
b. Thirty percent of credit sales are collected in the month of the sale and 70% in the following
month.
c. The ending finished goods inventory equals 30% of the following month's unit sales.
d. The ending raw materials inventory equals 20% of the following month's raw materials
production needs. Each unit of finished goods requires 5 pounds of raw materials. The raw
materials cost $2.70 per pound.
e. Twenty percent of raw materials purchases are paid for in the month of purchase and 80% in the
following month.
f. The direct labor wage rate is $14 per hour. Each unit of finished goods requires two direct labor-
hours.
g. The variable selling and administrative expense per unit sold is $1.60. The fixed selling and
administrative expense per month is $60,000.
Foundational 8-3 (Algo)
3. What is the accounts receivable balance at the end of July?
Accounts receivable
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