Iguana. Inc.. manufactures bamboo picture frames that sell for $30 each. Each fr
ID: 2464973 • Letter: I
Question
Iguana. Inc.. manufactures bamboo picture frames that sell for $30 each. Each frame requires 4 linear feel of bamboo, which costs S2.50 per root. Each frame takes approximately 30 minutes to build. and the lebor rate averages $12 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 pe 30 percet of -ext month's production. Expected unit sales (frames) 'or the upcoming months follow: Variaoie manufacture cve'-ead is incurred at a rate of S0.40 pe' unit produced. Annual 'Ixed manufacturing overhead is estimated to Ee S7.80C (S650 per mo-th) for expected product o" of 3.000 units fo' the year. Selling and administrative expenses are est mated at $700 per mo"th plus $0.50 per unit sold. lgua"3. Inc.. "ad S10.9C0 casn on hand o" April 1. Of is sales. SO pe'cent is "n cash. Of the credit sales. 50 percent is collected durfng the month of the sale, and 50 perce"t Is co ected d j'"g t"e month fo owing the sale. Of 'aw materia s purchases. SO pe'cent is paid fo- during the mont- purchased a-d 20 percent Is paid in the following mont". Raw mate'ais purchases fo' March 1 totaled S2.5C0. All other operating costs a'e paid during t-e month lncu''ed. Mo"thly fixed manufacturing ove'-ead includes $160 in deprec ation. During April. Iguana plans to pay $3,100 for a piece of eq j pment. Compute the following for Igjana. Inc.. for the second cuarter {April, May. and June). Compete Iguana's budgeted income statement for quarter 2. (Round cost per unit In intermed ate calculations and final answers to 2 decimal places.) Compute the budgeted cash receipts for Iguana. (Round your answer to 2 decimal places.) Compute the EuC9eted cash payments for Iguana. (Do not round your intermediate calculations. Round final answers to 2 decimal places.) Prepare the cash bucket for Iguana. Assume the company can borrow in increments of S 1.000 to maintain a S10.000 minimum cash balance. (Round your answers to 2 decimal places.)Explanation / Answer
Answer April May June 2nd Quarter Total Budgeted sales Revenue (in $) 7,800 9,300 12,300 29,400 Budgeted production in units 280 350 400 1030 Budgeted cost of Raw Material Purchase (in $) 3,010 3,650 4,015 10,675 Budgeted Direct Labour cost (in $) 1,680 2,100 2,400 6,180 Budgeted Manufacturing Overhead (In $) 762 790 810 2,362 Budgeted cost of goods sold (in $) 4,868 5,660 7,390 17,918 Total budgeted selling & admin exp.(in $) 830 855 905 2,590 Working Sales March April May June July August Sales in units 280 260 310 410 385 435 Selling rate per unit in $ 30 30 30 30 30 30 Sales in $ 8400 7800 9300 12300 11550 13050 Production March April May June July August Sales in units 280 260 310 410 385 435 Ending Inventory 104 124 164 154 174 Opening Inventory 104 124 164 154 Production 280 350 400 405 Raw material purchase March April May June July August Raw material requirement-linear 1120 1400 1600 1620 (in feets) Ending Raw material inventory 336 420 480 486 Opening Raw Material Inventory 336 420 480 Purchase of Raw Material 1204 1460 1606 Cost per foot in $ 2.5 2.5 2.5 Raw material purchase in $ 3010 3650 4015 Direct Labour cost March April May June July August Production in units 280 350 400 405 time required per unit in minutes 30 30 30 30 Total time required in minutes 8400 10500 12000 12150 Total time required in hours 140 175 200 202.5 Labour Rate per hour in $ 12 12 12 12 Direct Labour cost in $ 1680 2100 2400 2430 Manufacturing Overhead cost March April May June July August Production in units 280 350 400 405 Variable MFG OH cost per unit in $ 0.4 0.4 0.4 0.4 Total Variable MFG OH Cost in $ 112 140 160 162 Fixed MFG OH cost in $ 650 650 650 650 Total MFG Overhead cost 762 790 810 812 Budgeted selling and admin cost March April May June July August Sales in units 280 260 310 410 385 435 Variable Selling & admin cost per unit in $ 0.5 0.5 0.5 0.5 0.5 0.5 Variable Selling & admin cost in $ 140 130 155 205 192.5 217.5 Fixed selling & admin cost in $ 700 700 700 700 700 700 Total selling & admin cost 840 830 855 905 892.5 917.5 Cost of goods sold April May June Raw Materail requirment for production 1120 1400 1600 Cost per foot in $ 2.5 2.5 2.5 Raw material consumption in $ 2800 3500 4000 Direct Labour cost in $ 1680 2100 2400 Total MFG Overhead cost in $ 762 790 810 Total Factory cost in $ 5242 6390 7210 Total production in units 280 350 400 Cost per unit in $ 18.72 18.26 18.03 Sales in units 260 310 410 Cost of goods sold in $ 4,868 5,660 7,390