DataYear 2 QuarterYear 3 Quarter 123412 Budgeted unit sales 40,000 60,000 100,000 50,000 70,000 80,000 • Selling price per unit$8per unit • Accounts receivable, beginning balance$65,000 • Sales collected in the quarter sales are made75% • Sales collected in the quarter after sales are made25% • Desired ending finished goods inventory is30%of the budgeted unit sales of the next quarter • Finished goods inventory, beginning 12,000units • Raw materials required to produce one unit 5pounds • Desired ending inventory of raw materials is10%of the next quarter's production needs • Raw materials inventory, beginning23,000pounds • Raw material costs$0.80per pound • Raw materials purchases are paid60%in the quarter the purchases are made and40%in the quarter following purchase • Accounts payable for raw materials, beginning balance$81,500 Enter a formula into each of the cells marked with a ? below Review Problem: Budget Schedules Construct the sales budgetYear 2 QuarterYear 3 Quarter 123412 Budgeted unit sales?????? Selling price per unit?????? Total sales?????? Construct the schedule of expected cash collectionsYear 2 Quarter 1234Year Accounts receivable, beginning balance ? ? First-quarter sales ? ? ? Second-quarter sales ? ? ? Third-quarter sales ? ? ? Fourth-quarter sales ? ? Total cash collections ? ? ? ? ? Construct the production budgetYear 2 Quarter Year 3 Quarter 1234Year12Budgeted unit sales ? ? ? ? ? ? ? Add desired finished goods inventory ? ? ? ? ? ? Total needs ? ? ? ? ? ? Less beginning inventory ? ? ? ? ? ? Required production ? ? ? ? ? ? Construct the raw materials purchases budgetYear 2 Quarter Year 3 Quarter 1234Year1 Required production (units) ? ? ? ? ? ? Raw materials required to produce one unit ? ? ? ? ? ? Production needs (pounds) ? ? ? ? ? ? Add desired ending inventory of raw materials (pounds) ? ? ? ? ? Total needs (pounds) ? ? ? ? ? Less beginning inventory of raw materials (pounds) ? ? ? ? ? Raw materials to be purchased ? ? ? ? ? Cost of raw materials per pound????? Cost of raw materials to be purchased????? Construct the schedule of expected cash paymentsYear 2 Quarter 1234Year Accounts payable, beginning balance ? ? First-quarter purchases ? ? ? Second-quarter purchases ? ? ? Third-quarter purchases ? ? ? Fourth-quarter purchases ? ? Total cash disbursements ? ? ? ? ?

Solution: Schedule of expected cash collection is based on sales of difference months and their…

Answered: Year 2 Quarter Year 3 Quarter 1 2 3…

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter8: Budgeting

Section: Chapter Questions

Problem 3BE: Pasadena Candle Inc. budgeted production of 785,000 candles for January. Wax is required to produce...

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Data	Year 2 Quarter	Year 3 Quarter
	1	2	3	4	1	2
Budgeted unit sales	40,000	60,000	100,000	50,000	70,000	80,000

• Selling price per unit	$8	per unit
• Accounts receivable, beginning balance	$65,000
• Sales collected in the quarter sales are made	75%
• Sales collected in the quarter after sales are made	25%
• Desired ending finished goods inventory is	30%	of the budgeted unit sales of the next quarter
• Finished goods inventory, beginning	12,000	units
• Raw materials required to produce one unit	5	pounds
• Desired ending inventory of raw materials is	10%	of the next quarter's production needs
• Raw materials inventory, beginning	23,000	pounds
• Raw material costs	$0.80	per pound
• Raw materials purchases are paid	60%	in the quarter the purchases are made
and	40%	in the quarter following purchase
• Accounts payable for raw materials, beginning balance	$81,500

Enter a formula into each of the cells marked with a ? below
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
	1	2	3	4	Year
Accounts receivable, beginning balance	?				?
First-quarter sales	?	?			?
Second-quarter sales		?	?		?
Third-quarter sales			?	?	?
Fourth-quarter sales				?	?
Total cash collections	?	?	?	?	?

Construct the production budget	Year 2 Quarter		Year 3 Quarter
	1	2	3	4	Year	1	2
Budgeted unit sales	?	?	?	?	?	?	?
Add desired finished goods inventory	?	?	?	?	?	?
Total needs	?	?	?	?	?	?
Less beginning inventory	?	?	?	?	?	?
Required production	?	?	?	?	?	?

Construct the raw materials purchases budget	Year 2 Quarter		Year 3 Quarter
	1	2	3	4	Year	1
Required production (units)	?	?	?	?	?	?
Raw materials required to produce one unit	?	?	?	?	?	?
Production needs (pounds)	?	?	?	?	?	?
Add desired ending inventory of raw materials (pounds)	?	?	?	?	?
Total needs (pounds)	?	?	?	?	?
Less beginning inventory of raw materials (pounds)	?	?	?	?	?
Raw materials to be purchased	?	?	?	?	?
Cost of raw materials per pound	?	?	?	?	?
Cost of raw materials to be purchased	?	?	?	?	?

Construct the schedule of expected cash payments	Year 2 Quarter
	1	2	3	4	Year
Accounts payable, beginning balance	?				?
First-quarter purchases	?	?			?
Second-quarter purchases		?	?		?
Third-quarter purchases			?	?	?
Fourth-quarter purchases				?	?
Total cash disbursements	?	?	?	?	?

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