Iguana, Inc., manufactures bamboo picture frames that sell for $30 each. Each fr
ID: 2449116 • Letter: I
Question
Iguana, Inc., manufactures bamboo picture frames that sell for $30 each. Each frame requires 5 linear feet of bamboo, which costs $2.00 per foot. Each frame takes approximately 30 minutes to build, and the labor rate averages $10.00 per hour. Iguana has the following inventory policies Ending finished goods inventory should be 40 percent of next month's sales Ending raw materials inventory should be 30 percent of next month's production Expected unit sales (frames) for the upcoming months follow: 285 260 310 410 380 435 March ril May June July August Variable manufacturing overhead is incurred at a rate of $0.50 per unit produced. Annual fixed manufacturing overhead is estimated to be $6,500 (S650 per month) for expected production of 5,000 units for the year. Selling and administrative expenses are estimated at $660 per month plus $0.80 per unit sold Iguana, Inc., had $10,900 cash on hand on April 1... Of its sales, 80 percent is in cash. Of the credit sales, 50% is collected during the month of the sale, and 50% is collected during the month following the sale Of raw materials purchases, 80 percent is paid for during the month purchased and 20 percent is paid in the following month. Raw materials purchases for March 1 totaled $2,100. All other operating costs are paid during the month incurred. Monthly fixed manufacturing overhead includes $160 in depreciation. During April, Iguana plans to pay $3,100 for a piece of equipment. Required 1. Compute the budgeted cash receipts for lguana. (Do not round your intermediate calculations Round final answers to 2 decimal places.) April May June 2nd Quarter Total Budgeted Cash Receipts 0.00Explanation / Answer
WORKINGS
Cash Budget for Iguana
Budgeted Cash Receipts April May June 2nd Quarter Total Sales for the month 7,800 9,300 12,300 29,400 Cash Sales (80% of above) 6,240 7,440 9,840 23,520 Credit Sales 1,560 1,860 2,460 5,880 - Amount received on cash sales 6,240 7,440 9,840 23,520 Amount received on credit sales of current month 780 930 1,230 2,940 Amount received on credit sales of previous month 855 780 930 2,565 (50% of credit sales of last month) - Total 7,875 9,150 12,000 29,025