Exam 22: Master Budgets and Planning

The sales budget for Carmel shows that 20,000 units of Product A and 22,000 units of Product B are going to be sold for prices of $10 and $12,respectively.The desired ending inventory of Product A is 20% higher than its beginning inventory of 2,000 units.The beginning inventory of Product B is 2,500 units.The desired ending inventory of B is 3,000 units.Budgeted purchases of Product B for the year would be:

The financial budgets include the cash budget and the capital expenditures budget.

Kent Company anticipates total sales for April,May,and June of $800,000,$900,000,and $950,000 respectively.Cash sales are normally 25% of total sales.Of the credit sales,30% are collected in the same month as the sale,65% are collected during the first month after the sale,and the remaining 5% are not collected.Compute the amount of cash received from credit sales for June.

A plan that shows the expected cash inflows and cash outflows during the budget period,including receipts from loans needed to maintain a minimum cash balance and repayments of such loans,is called a(n):

A plan that lists the types and amounts of operating expenses expected that are not included in the selling expenses budget is a:

A managerial accounting report that presents predicted amounts of the company's revenues and expenses for the budget period is called a:

Lara Company's budget includes the following credit sales for the current year: September,$25,000; October,$36,000; November,$30,000; December,$32,000.Experience has shown that payment for the credit sales is received as follows: 15% in the month of sale,60% in the first month after sale,20% in the second month after sale,and 5% is uncollectible.How much cash can Lara Company expect to collect in November as a result of current and past credit sales?

Del Carpio,Inc.,sells two products,Widgets and Gadgets.The sales forecast in units for the first quarter of the coming year is: Cash sales are 30% of each product's monthly sales.The remaining sales are credit sales which are collected as follows: 70% in the month of sale,20% the next month,and 10% in the following month.Unit sale prices are $30 and $20 for Widgets and Gadgets,respectively. Determine the company's cash receipts for March from its current and past sales.

Airtex Company budgeted the following credit sales during the current year: September,$90,000; October,$123,000; November,$105,000; December,$111,000.Experience has shown that cash from credit sales is received as follows: 10% in the month of sale,50% in the first month after sale,35% in the second month after sale,and 5% is uncollectible.How much cash should Airtex Company expect to collect in November from all current and past credit sales?

Guidance for preparing a master budget is usually the responsibility of:

A budget is best described as:

Kent Company anticipates total sales for April,May,and June of $800,000,$900,000,and $950,000 respectively.Cash sales are normally 25% of total sales.Of the credit sales,30% are collected in the same month as the sale,65% are collected during the first month after the sale,and the remaining 5% are collected in the second month.Compute the amount of accounts receivable reported on the company's budgeted balance sheet for June 30.

A master budget refers to a company's sales budget that includes all of its segments or departments.

Peru,Inc.is preparing its master budget for the first quarter of its calendar year.The following forecasted data relate to the first quarter: Prepare a budgeted income statement for this first quarter.

Grafton budgets production of 300 units in June and 310 units in July.Each finished unit requires 4 pounds of raw material K,which costs $5 per pound.Each month's ending inventory of raw materials should be 30% of the following month's budgeted production.The June 1 raw materials inventory has 360 pounds of raw material K.Compute budgeted purchases for raw material K for June.

The master budget process nearly always begins with the preparation of the ___________________ and usually finishes with the preparation of the ______________________,the ________________,and the ______________________.

The master budget includes:

A June sales forecast projects that 6,000 units are going to be sold at a price of $10.50 per unit.The desired ending inventory of units is 15% higher than the beginning inventory of 1,000 units.Total June sales are anticipated to be:

Julia's Candy Co.reports the following information from its sales account and sales budget: Cash sales are normally 25% of total sales and all credit sales are expected to be collected in the month following the date of sale.The total amount of cash expected to be received from customers in September is:

Use the following information to determine the ending cash balance to be reported on the month ended June 30 cash budget. A.Beginning cash balance on June 1,$94,000. B.Cash receipts from sales,$413,000. C.Budgeted cash disbursements for purchases,$268,000. D.Budgeted cash disbursements for salaries,$95,000. E.Other budgeted expenses,$57,000. F.Cash repayment of bank loan,$32,000. G.Budgeted depreciation expense,$34,000.