Can you please first prodvide the answer for question 3 Part 1 Part2 And part 3
ID: 2510598 • Letter: C
Question
Can you please first prodvide the answer for question 3 Part 1 Part2 And part 3 After all the anwers please provide the process Questions 1- 3 (of 3) Save & Exdt Submit The folowing information applies to the questions displayed below. Iguana, Inc., manufactures bamboo picture frames that sell for $25 each. Each frame requires 4 linear feet of bamboo, which costs $2.50 per foot. Each frame takes approximately 30 minutes to build, and the labor rate averages $14 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 315 330 380 480 455 505 Aprill June July August $7,200 ($600 per Variable manufacturing overhead is incurred at a rate of SOGO per unit produced. Annual fined manufacturing overhead is estimated to be month) for expected production of 3,000 units for the yeer Seling and edminstratv e expenses are estimated at $650 per month plus $0.50 per unit sold cash on hand on April 1 o its sales, 80 percent is in cash, Of the credit sales, 50 percent is collected during the month of the sale, Iguana, Inc., had $11,000 and 50 percent is collected during the month following the sale. purchases for raw materials purchases, 80 percent is paid for during the month purchased and 20 percent is paid in the following month. Raw materials the moeth incurred. Monthly fixed manufacturing overhead includes $230 in depreciation. During incurred. M March 1 totaled $3,000. All other operating costs are paid during Apri, Iguana plans to pay $2,000 for a piece of equipment Required information 1. 33.33 pointsExplanation / Answer
Solution:
Part 1 --- Budgeted Cash Receipts
Schedule of Expected Cash Collections
March
April
May
June
2nd Quarter total
Budgeted Sales Units
315
330
380
480
1190
Unit Selling Price
$25
$25
$25
$25
$25
Budgeted Sales in dollars
$7,875
$8,250
$9,500
$12,000
$29,750
Cash Sales (Total Sales * 80%)
$6,300
$6,600
$7,600
$9,600
$23,800
Credit Sales (Total Sales * 20%)
$1,575
$1,650
$1,900
$2,400
$5,950
Schedule of Expected Cash Collections:
Cash Sales
$6,600
$7,600
$9,600
$23,800
March Credit Sales
787.5
$787.50
April Credit Sales
825
825
$1,650
May Credit Sales
950
$950
$1,900
June Credit Sales
$1,200
$1,200
Total Budgeted Cash Receipts
$8,212.50
$9,375
$11,750
$29,337.50
Part 2 --- Budgeted Cash Payments
Budgeted Cash Payments
April
May
June
2nd Quarter Total
Budgeted Cash Payment for Materials Purchases (Refer Note 1)
$3,568.00
$4,222.00
$4,642.00
$12,432.00
Cash Payment for Labor (Refer Note 2)
$2,450.00
$2,940.00
$3,290.00
$8,680.00
Payment for Variable Manufacturing Overhead (Refer note 3)
$210.00
$252.00
$282.00
$744.00
Fixed Manufacturing Overhead (excluding depreciation since depreciation is a non cash item and does not involve any cash outflow) ($600 - 230)
$370.00
$370.00
$370.00
$1,110.00
Selling and Administrative Expense (Refer Note 4)
$825.00
$860.00
$885.00
$2,570.00
Payment for Equipment
$2,000.00
$2,000.00
Total Budgeted Cash Payments
$9,423.00
$8,644.00
$9,469.00
$27,536.00
Note 1 –
Working for Budgeted Cash Payment for Merchandise Purchase
April
May
June
July
Next Month's Sales Unit
380
480
455
505
Desired Ending Inventory Ratio
40%
40%
40%
40%
Desired Ending Inventory
152
192
182
202
Plus: Budgeted Sales Unit
330
380
480
455
Total Needs
482
572
662
657
Less: Beginning Finished Goods Inventory (ending inventory of last month)
132
152
192
182
Budgeted Production in Units
350
420
470
475
Required Raw material per unit (linear feet)
4
4
4
4
Total Required Raw Material for Production (pounds)
1400
1680
1880
1900
Add: Desired Ending Raw Material Inventory (30% of next month's production need)
504
564
570
Less: Estimated Beginning Raw material inventory (ending inventory of last month)
420
504
564
Total Budgeted Purchases Raw Material (linear feet)
1484
1740
1886
Cost per foot
$2.50
$2.50
$2.50
Budgeted Cost of Raw materials purchases
$3,710
$4,350
$4,715
Cash Payment Schedule for Merchandise Purchases:
April
May
June
2nd Quarter Total
March Purchases ($3,000*20%)
$600.00
$600.00
April Purchases
$2,968.00
$742.00
$3,710.00
May Purchases
$3,480.00
$870.00
$4,350.00
June Purchases
$3,772.00
$3,772.00
Total Cash Payment for Purchases
$3,568.00
$4,222.00
$4,642.00
$12,432.00
Note 2 –
Budgeted Direct Labor Cost
April
May
June
2nd Quarter Total
Budgeted Production Units (Frames) (Refer Note 1)
350
420
470
1240
Required Labor Hour per frame
0.50
0.50
0.50
0.50
Total Required Labor Hours
175.00
210.00
235.00
620.00
Labor Rate per hour
$14.00
$14.00
$14.00
$14.00
Labor Cost Budget
$2,450.00
$2,940.00
$3,290.00
$8,680.00
Note 3
Variable Manufacturing Overhead
April
May
June
2nd Quarter Total
Budgeted Production Units (Frames) (Refer Note 1)
350
420
470
1240
Variable Manufacturing Expense per unit produced
$0.60
$0.60
$0.60
$0.60
Total Budgeted Variable Manufacturing Overhead
210.00
252.00
282.00
744.00
Note 4
Selling and Administrative Expenses
April
May
June
2nd Quarter Total
Units Sold
350.00
420.00
470.00
$1,240
Variable Selling & Admin Expenses per unit sold
$0.50
$0.50
$0.50
$0.50
Total Variable S&A Expense
$175.00
$210.00
$235.00
$620.00
Add: Fixed S&A Exp
$650
$650
$650
$650
Total S&A Exp
$825
$860
$885
$2,570
Part 3 --- Cash Budget
Cash Budget
April
May
June
2nd Quarter Total
Beginning Cash Balance
$11,000.00
$10,789.50
$10,520.50
$11,000.00
Plus: Budgeted Cash Receipt (Refer Part 1)
$8,212.50
$9,375.00
$11,750.00
$29,337.50
Less: Budgeted Cash Payments (Refer Part 2)
$9,423.00
$8,644.00
$9,469.00
$27,536.00
Preliminary Cash Balance
$9,789.50
$11,520.50
$12,801.50
$12,801.50
Cash Borrowed / Repaid
$1,000.00
-$1,000.00
$0.00
$0.00
Ending Cash Balance
$10,789.50
$10,520.50
$12,801.50
$12,801.50
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Schedule of Expected Cash Collections
March
April
May
June
2nd Quarter total
Budgeted Sales Units
315
330
380
480
1190
Unit Selling Price
$25
$25
$25
$25
$25
Budgeted Sales in dollars
$7,875
$8,250
$9,500
$12,000
$29,750
Cash Sales (Total Sales * 80%)
$6,300
$6,600
$7,600
$9,600
$23,800
Credit Sales (Total Sales * 20%)
$1,575
$1,650
$1,900
$2,400
$5,950
Schedule of Expected Cash Collections:
Cash Sales
$6,600
$7,600
$9,600
$23,800
March Credit Sales
787.5
$787.50
April Credit Sales
825
825
$1,650
May Credit Sales
950
$950
$1,900
June Credit Sales
$1,200
$1,200
Total Budgeted Cash Receipts
$8,212.50
$9,375
$11,750
$29,337.50