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Exam 8: Master Budgeting

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Question 41

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Wala Inc.bases its selling and administrative expense budget on the number of units sold.The variable selling and administrative expense is $8.20 per unit.The budgeted fixed selling and administrative expense is $132,800 per month, which includes depreciation of $14,400.The remainder of the fixed selling and administrative expense represents current cash flows.The sales budget shows 8,000 units are planned to be sold in July. Required: Prepare the selling and administrative expense budget for July.

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Question 42

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The selling and administrative expense budget lists all costs of production other than direct materials and direct labor.

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B) False

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Question 43

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Stut Corporation, a retailer, plans to sell 28,000 units of Product X during the month of August.If the company has 6,000 units on hand at the start of the month, and plans to have 9,000 units on hand at the end of the month, how many units of Product X must be purchased from the supplier during the month?

The cash disbursements during June for goods purchased for sale and for selling and administrative expenses should be:

The production department of Tarre Corporation has submitted the following forecast of units to be produced by quarter for the upcoming fiscal year. Each unit requires 0.30 direct labor-hours at $16.00 per hour. Required Prepare a direct labor budget for the upcoming fiscal year, assuming that the direct labor work force is adjusted each quarter to match the number of hours required to produce the budgeted production.

The excess (deficiency) of cash available over disbursements for March will be:

Darke Corporation makes one product and has provided the following information: a.Budgeted unit sales for October, November, and December are 7,600, 9,000, and 10,100 units respectively. b.The ending finished goods inventory equals 40% of the following month's sales. c.Each unit of finished goods requires 5 pounds of raw materials.The raw materials cost $1.00 per pound. d.The direct labor wage rate is $19.00 per hour.Each unit of finished goods requires 3.0 direct labor-hours. e.Manufacturing overhead is entirely variable and is $11.00 per direct labor-hour. The estimated finished goods inventory balance at the end of November is closest to:

The budgeted sales for August is closest to:

Botz Corporation makes one product and it provided the following information to help prepare the master budget for the next four months of operations: > The budgeted selling price per unit is $94.Budgeted unit sales for April, May, June, and July are 8,200, 10,600, 10,100, and 15,200 units, respectively.All sales are on credit. > Regarding credit sales, 40% are collected in the month of the sale and 60% in the following month. > The ending finished goods inventory equals 30% of the following month's sales. > The ending raw materials inventory equals 40% of the following month's raw materials production needs.Each unit of finished goods requires 2 pounds of raw materials.The raw materials cost $1.00 per pound. > Regarding raw materials purchases, 10% are paid for in the month of purchase and 90% in the following month. > The direct labor wage rate is $23.00 per hour.Each unit of finished goods requires 2.4 direct labor-hours. Required: a.What are the budgeted sales for May? b.What are the expected cash collections for May? c.What is the budgeted accounts receivable balance at the end of May? d.According to the production budget, how many units should be produced in May? e.If 23,260 pounds of raw materials are needed for production in June, how many pounds of raw materials should be purchased in May? f.What is the estimated cost of raw materials purchases for May? g.If the cost of raw material purchases in April is $19,064, then in May what are the total estimated cash disbursements for raw materials purchases? h.What is the estimated accounts payable balance at the end of May? i.What is the estimated raw materials inventory balance at the end of May? j.What is the total estimated direct labor cost for May assuming the direct labor workforce is adjusted to match the hours required to produce the forecasted number of units produced? k.For simplicity, we will assume that there is no fixed manufacturing overhead and that the variable manufacturing overhead is $11.00 per direct labor-hour.What is the estimated unit product cost? l.What is the estimated finished goods inventory balance at the end of May?

The total cash collected during January by LaGrange Corporation would be:

Bentsen Corporation makes one product. The ending finished goods inventory equals 40% of the following month's sales.The ending raw materials inventory equals 10% of the following month's raw materials production needs.Each unit of finished goods requires 6 pounds of raw materials.The raw materials cost $2.00 per pound.If 76,680 pounds of raw materials are required for production in September, then the budgeted cost of raw material purchases for August is closest to:

The cost of December merchandise purchases would be:

Crocetti 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 The budgeted accounts receivable balance at the end of February is closest to:

The total number of units to be produced in July is:

Litzinger Corporation makes one product.The ending raw materials inventory should equal 20% of the following month's raw materials production needs.Each unit of finished goods requires 4 pounds of raw materials.The raw materials cost $1.00 per pound.The company estimates that it will need 53,720 pounds of raw material to satisfy production needs in June.The raw materials inventory balance at the end of May should be closest to:

The budgeted accounts receivable balance at the end of February is closest to:

To attain its desired ending cash balance for March, the company needs to borrow:

Yerkey Corporation makes one product and has provided the following information to help prepare the master budget: The estimated selling and administrative expense for February is closest to:

Um Corporation has provided the following information concerning its raw materials purchases.The budgeted cost of raw materials purchases in November is $286,032.The company pays for 40% of its raw materials purchases in the month of purchase and 60% in the following month.The budgeted accounts payable balance at the end of November is closest to:

Expected cash collections in December are: