Please don\'t answer the question unless you\'re willing to answer the entire qu
ID: 2438844 • Letter: P
Question
Please don't answer the question unless you're willing to answer the entire question, it has 10 parts total.
a.Actual sales in December were S71,000. Selling price per unit is projected to remain stable at $12 per unit throughout the budget period. Sales for the first five months of the upcoming year are budgeted to be as follows January February March Apnil May S 118,800 S 115,200 S 108,000 S 103,200 b,Sales are 35% cash and 65% credit. All credit sales are collected in the month following the c.Damon Manufacturing has a policy that states that each month's ending inventory of finished d.Of each month's direct material purchases, 20% are paid for in the month of purchase, while sale. goods should be 10% of the following month's sales (in units). the remainder is paid for in the month following purchase. Three pounds of direct material i needed per unit at $2.00 per pound. Ending inventory of direct materials should be 20% of next month's production needs e.Most of the labor at the manufacturing facility is indirect, but there is some direct labor curred. The direct labor hours per unit is 0.05. The direct labor rate per hour is S9 per hour All direct labor is paid for in the month in which the work is performed. The direct labor total cost for each of the upcoming three months is as fol January February March S 3,807 S 4,442 S 4,293 f. Monthly manufacturing overhead costs are $5,500 for factory rent, $2,900 for other fixed manufacturing expenses, and S1.10 per unit for variable manufacturing overhead. No depreciation is included in these figures. All expenses are paid in the month are incurred. ch the In January, Damon Manufacturing ill purchase equipment for $5,000 (cash) Februarys cash expenditure will be $12,200 and March's cash expenditure will be $16,600 h.Operating expenses are budgeted to be $1.25 per unit sold plus fixed operating expenses of 1,800 per month. All operating expenses are paid in the month in which they are incurred No depreciation is included in these figures i. Depreciation on the building and equipment for the general and administrative offices is budgeted to be $4,600 for the entire quarter, which includes depreciation on new acquisitions J. Damon Manufacturing has a policy that the ending cash balance in each month must be at of $1,000 at the beginning of each month, up to a total outstanding loan balance of $180,000. The interest rate on these loans is 1% per month simple interest (not compounded). The company would pay down on the line of credit balance in increments of $1,000 if it has excess funds at the end of the quarter. The company would also pay the accumulated interest at the end of the quarter on the funds borrowed during the quarter. k.The company's income tax rate is projected to be 30% of operating income less interest expense. The company pays $10,000 cash at the end of February in estimated taxes.Explanation / Answer
1.
2.
3.
4.
Damon Manufacturing Cash Collections Budget For the Quarter Ended March 31 January February March Quarter Cash Sales 34,860 41,580 40,320 116,760 December Credit Sales 53,000 53,000 January Credit Sales 64,740 64,740 February Credit Sales 77,220 77,220 Total Cash Collections 87,860 106,320 117,540 311,720