Exam 8: Master Budgeting

Luchini Corporation makes one product and it provided the following information to help prepare the master budget for the next four months of operations: a. The budgeted selling price per unit is $111. Budgeted unit sales for April, May, June, and July are 7,100, 10,100, 13,300, and 14,000 units, respectively. All sales are on credit. b. Regarding credit sales, 40% are collected in the month of the sale and 60% in the following month. c. The ending finished goods inventory equals 10% of the following month's sales. d. The ending raw materials inventory equals 30% of the following month's raw materials production needs. Each unit of finished goods requires 5 pounds of raw materials. The raw materials cost $5.00 per pound. e. Regarding raw materials purchases, 40% are paid for in the month of purchase and 60% in the following month. f. The direct labor wage rate is $18.00 per hour. Each unit of finished goods requires 2.9 direct labor-hours. g. Variable manufacturing overhead is $7.00 per direct labor-hour. Fixed manufacturing overhead is zero. -The budgeted accounts receivable balance at the end of May is closest to:

Stefanovich Corporation makes one product.The company has provided the following information concerning its raw materials needs: • The ending raw materials inventory should equal 20% of the following month's raw materials production needs. • Each unit of finished goods requires 2 pounds of raw materials. • The raw materials cost $3.00 per pound. • The company will need 26,440 pounds of raw material to satisfy production needs in March. The raw materials inventory balance at the end of February should be closest to:

The following are budgeted data: One pound of material is required for each finished unit.The inventory of materials at the end of each month should equal 20% of the following month's production needs.Purchases of raw materials for February would be budgeted to be:

Fuson Corporation makes one product and has provided the following information to help prepare the master budget for the next four months of operations: Credit sales are collected: 30% in the month of the sale 70% in the following month Raw materials purchases are paid: 30% in the month of purchase 70% in the following month The ending finished goods inventory should equal 10% of the following month's sales. The ending raw materials inventory should equal 10% of the following month's raw materials production needs. -If the budgeted cost of raw materials purchases in October is $116,772 and in November is $129,120,then in November the total budgeted cash disbursements for raw materials purchases is closest to:

The usual starting point for a master budget is:

-Zolezzi Inc.is preparing its cash budget for March.The budgeted beginning cash balance is $42,000.Budgeted cash receipts total $178,000 and budgeted cash disbursements total $175,000.The desired ending cash balance is $50,000.The company can borrow up to $160,000 at any time from a local bank,with interest not due until the following month. Required: Prepare the company's cash budget for March in good form.Make sure to indicate what borrowing,if any,would be needed to attain the desired ending cash balance.

Bonkowski Corporation makes one product and has provided the following information to help prepare the master budget for the next four months of operations: Credit sales are collected: 30% in the month of the sale 70% in the following month Raw materials purchases are paid: 30% in the month of purchase 70% in the following month The ending finished goods inventory should equal 30% of the following month's sales. The ending raw materials inventory should equal 10% of the following month's raw materials production needs. -The estimated cost of goods sold for February is closest to:

Kesselring Corporation makes one product and has provided the following information to help prepare the master budget for the next three months of operations: The ending finished goods inventory should equal 40% of the following month's sales. The budgeted finished goods inventory balance at the end of August is closest to:

Sevenbergen Corporation makes one product and has provided the following information to help prepare the master budget for the next four months of operations: Credit sales are collected: 40% in the month of the sale 60% in the following month Raw materials purchases are paid: 30% in the month of purchase 70% in the following month The ending finished goods inventory should equal 20% of the following month's sales. The ending raw materials inventory should equal 30% of the following month's raw materials production needs. -If 41,920 pounds of raw materials are required for production in September,then the budgeted cost of raw material purchases for August is closest to:

All of Gaylord Corporation's sales are on account.Thirty-five percent of the sales on account are collected in the month of sale,45% in the month following sale,and the remainder are collected in the second month following sale.The following are budgeted sales data for the company: What is the amount of cash that should be collected in March?

Sioux Corporation is estimating the following sales for the first four months of next year: Sales are normally collected 60% in the month of sale and 40% in the month following the sale.Based on this information,how much cash should Sioux expect to collect during the month of April?

The manufacturing overhead budget at Polich Corporation is based on budgeted direct labor-hours. The direct labor budget indicates that 1,600 direct labor-hours will be required in February. The variable overhead rate is $3.40 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $28,320 per month, which includes depreciation of $3,680. All other fixed manufacturing overhead costs represent current cash flows. -The February cash disbursements for manufacturing overhead on the manufacturing overhead budget should be:

The Jung Corporation's production budget calls for the following number of units to be produced each quarter for next year: Budgeted production Each unit of product requires three pounds of direct material.The company's policy is to begin each quarter with an inventory of direct materials equal to 30% of that quarter's direct material requirements.Budgeted direct materials purchases for the third quarter would be:

Bonkowski Corporation makes one product and has provided the following information to help prepare the master budget for the next four months of operations: Credit sales are collected: 30% in the month of the sale 70% in the following month Raw materials purchases are paid: 30% in the month of purchase 70% in the following month The ending finished goods inventory should equal 30% of the following month's sales. The ending raw materials inventory should equal 10% of the following month's raw materials production needs. -The budgeted accounts receivable balance at the end of February is closest to:

Sevenbergen Corporation makes one product and has provided the following information to help prepare the master budget for the next four months of operations: Credit sales are collected: 40% in the month of the sale 60% in the following month Raw materials purchases are paid: 30% in the month of purchase 70% in the following month The ending finished goods inventory should equal 20% of the following month's sales. The ending raw materials inventory should equal 30% of the following month's raw materials production needs. -The budgeted sales for August is closest to:

Sleeter Corporation makes one product and it provided the following information to help prepare the master budget for the next four months of operations: A.Budgeted unit sales for April,May,June,and July are 7,500,11,900,10,800,and 14,800 units,respectively.All sales are on credit. B.The ending finished goods inventory equals 30% of the following month's sales. C.The ending raw materials inventory equals 30% of the following month's raw materials production needs.Each unit of finished goods requires 6 pounds of raw materials.The raw materials cost $5.00 per pound. If 72,000 pounds of raw materials are required for production in June,then the budgeted cost of raw material purchases for May is closest to:

Bonkowski Corporation makes one product and has provided the following information to help prepare the master budget for the next four months of operations: Credit sales are collected: 30% in the month of the sale 70% in the following month Raw materials purchases are paid: 30% in the month of purchase 70% in the following month The ending finished goods inventory should equal 30% of the following month's sales. The ending raw materials inventory should equal 10% of the following month's raw materials production needs. -The estimated net operating income (loss)for February is closest to:

Sirignano Corporation produces and sells one product.The budgeted selling price per unit is $84.Budgeted unit sales for October,November,December,and January are 8,400,12,000,13,800,and 14,300 units,respectively.All sales are on credit with 40% collected in the month of the sale and 60% in the following month.The expected cash collections for November is closest to:

Marty's Merchandise has budgeted sales as follows for the second quarter of the year: Cost of goods sold is equal to 70% of sales. The company wants to maintain a monthly ending inventory equal to 120% of the cost of goods sold for the following month. The inventory on March 31 was below this target and was only $22,000. The company is now preparing a Merchandise Purchases Budget for April, May, and June. -The total number of units produced in July should be:

The budgeted variable selling and administrative expense is calculated by multiplying the budgeted unit sales by the variable selling and administrative expense per unit.