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The management of Zigby Manufacturing prepared the following balance sheet for March 31 ZIGBY MANUFACTURING Balance Sheet March 31 Assets Liabilities and Equity Cash $ 57,000 Liabilities Accounts receivable 486,000 Accounts payable Raw waterials inventory 91,600 Loan payable Finished goods Inventory 380,480 Long-tern note payable Equipment 5.634,000 Equity Less: Accumulated depreciation 167.000 467,000 Common stock Retained earnings Total assets $ 1,482,289 Total liabilities and equity To prepare a master budget for April, May, and June, management gathers the following information $ 206,309 29,000 500,000 5.735,300 352,000 314, 780 666, 780 5. 1.402,080 a. Sales for March total 23,200 units, Budgeted sales in units follow: April, 23, 200; May, 17,100, June, 21,900; and July 13,200. The product's selling price is $25.00 per unit and its total product cost is $20.50 per unit. b. Raw materials inventory consists solely of direct materials that cost $20 per pound. Company policy calls for a given month's ending materials inventory to equal 50% of the next month's direct materials requirements. The March 31 raw materials inventory is 4.580 pounds. The budgeted June 30 ending raw materials inventory is 5,700 pounds Each finished unit requires 0.50 pound of direct materials c. Company policy calls for a given month's ending finished goods Inventory to equal 80% of the next month's budgeted unit sales. The March 31 finished goods inventory is 18,560 units d. Each finished unit requires 0,50 hour of direct labor at a rate of $13 per hour e. The predetermined variable overhead rate is $4.40 per direct labor hour Depreciation of $37.320 per month is the only fixed factory overhead item 4. Sales commissions of 5% of sales are paid in the month of the sales. The sales manager's monthly salary is $4,700 9. Monthly general and administrative expenses include $29,000 for administrative sataries and 0.8% monthly interest on the long- term note payable h. The company budgets 30% of sales to be for cash and the remaining 70% on credit Credit sales are collected in full in the month following the sale (no credit sales are collected in the month of sale) 1. All raw materials purchases are on credit , and accounts payable are solely tied to raw materials purchases Raw materials purchases are fully paid in the next month (none are paid in the month of purchase) J. The minimum ending cash balance for all months is $57,000. If necessary, the company borrows enough cash using a loan to reach the minimum. Loans require an interest payment of 1% at each month-end (before any repayment). If the month end preliminary cash balance exceeds the minimum, the excess will be used to repay any loans k. Dividends of $27000 are budgeted to be declared and paid in May 1. No cash payments for income taxes are budgeted in the second calendar quarter Income tax will be assessed at 35% in the quarter and budgeted to be paid in the third calendar quarter or orec c. Company policy calls for a given month's ending finished goods inventory to equal 80% of the next month's budgeted unit sales. The March 31 finished goods inventory is 18,560 units d. Each finished unit requires 0.50 hour of direct laborat a rate of $13 per hour. e. The predetermined variable overhead rate is $4.40 per direct labor hour. Depreciation of $37 320 per month is the only fixed factory overhead item f. Sales commissions of 5% of sales are paid in the month of the sales. The sales manager's monthly salary is $4,700 g. Monthly general and administrative expenses include $29,000 for administrative salaries and 0.8% monthly interest on the long- term note payable h. The company budgets 30% of sales to be for cash and the remaining 70% on credit Credit sales are collected in full in the month following the sale (no credit sales are collected in the month of sale). i. All raw materials purchases are on credit, and accounts payable are solely tied to raw materials purchases, Raw materials purchases are fully paid in the next month (none are paid in the month of purchase) j. The minimum ending cash balance for all months is $57,000. If necessary, the company borrows enough cash using a loan to reach the minimum. Loans require an interest payment of 1% at each month-end (before any repayment). If the month-end preliminary cash balance exceeds the minimum, the excess will be used to repay any loans k. Dividends of $27,000 are budgeted to be declared and paid in May 1. No cash payments for income taxes are budgeted in the second calendar quarter income tax will be assessed at 35% in the quarter and budgeted to be paid in the third calendar quarter. m. Equipment purchases of $100.000 are budgeted for the last day of June Required: Prepare the following budgets for the months of April, May, and June; 1. Sales budget 2. Production budget 3. Direct materials budget 4. Direct labor budget 5. Factory overhead budget 6. Selling expense budget 7. General and administrative expense budget 8. Schedule of cash receipts 9. Schedule of cash payments for direct materials 10. Cash budget 11. Budgeted income statement for entire second quarter (not monthly 12. Budgeted balance sheet at June 30. Reg 1 Req 2 Req 3 Req 4 Reg 5 Reg 6 Req 7 Sales budget. ZIGBY MANUFACTURING Sales Budgets April May June Budgeted sales units Selling price per unit Total budgeted sales GA $ 0 $ 0 $ 0 Production budget. ZIGBY MANUFACTURING Production Budget April May June Total Budgeted sales units 17 100 21.900 23 200 Next period budgeted sales units Ratio of inventory to future sales Desired ending inventory units Total required units 80% 80% 80% Units to produce Reg 1 Reg 2 Reg 3 Req 4 Reg 5 Req 6 Req 7 Req 8 to 10 Direct materials budget. (Round per unit values to 2 decimal places.) ZIGBY MANUFACTURING Direct Materials Budget April May June Units to produce Materials needed for production (pounds) Total materials required (pounds) Materials to purchase (pounds) Materials cost per pound Cost of direct materials purchases Req 1 Reg 2 Req3 Reg 4 Req 5 Reg 6 Req 7 Reg 8 to 1 Direct labor budget. (Round per unit values to 2 decimal places.) ZIGBY MANUFACTURING Direct Labor Budget April May June Total Units to produce Direct labor hours needed 0 Cost of direct labor Req 1 Reg 2 Req3 Reg 4 Reg 5 Reg 6 Req 7 Req 8 to 10 Req Factory overhead budget. (Round variable overhead rate values to 2 decimal places.) June Total ZIGBY MANUFACTURING Factory Overhead Budget April May Direct labor hours needed Variable overhead rate per direct labor hour Budgeted variable overhead Budgeted fixed overhead Budgeted total factory overhead Req 4 Req6 > Reg 1 Reg 2 Reg 3 Reg 4 Reg 5 Req 6 Reg 7 Reg 8 to 1 Selling expense budget. ZIGBY MANUFACTURING Selling Expense Budget April May June Budgeted sales Sales commissions Reqi Reg 2 Reg 3 Req 4 Reg 5 Reg 6 Req 7 Reg 8 to 10 Reg 11 General and administrative expense budget. ZIGBY MANUFACTURING General and Administrative Expense Budget April May June Total general and administrative expenses Reg 1 Req 2 Reg 3 Reg 4 Reg 5 Req 6 Req 7 Reg 8 to 10 Reg 11 Reg 12 8. Schedule of cash receipts. 9. Schedule of cash payments for direct materials. 10. Cash budget. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign.) Show less ZIBGY MANUFACTURING Schedule of Cash Receipts April $ 580,000 $ May 427.500 $ June 547,500 Sales Cash receipts from Cash sales Collections of prior period sales Total cash receipts s June 228.700 Schedule of Cash Payments for Direct Materials April May Materials purchases $ 196,300 $ 219,400 5 Cash payments for Current period purchases Prior period purchases Total cash payments $ 0 0 Cash Budget April May June Beginning cash balance Total cash available Less: Cash payments for Total cash payments 0 $ 0$ Cash Budget April May June Beginning cash balance Total cash available Less: Cash payments for Total cash payments Preliminary cash balance 0 Ending cash balance Loan balance April May June Loan balance - Beginning of month Additional loan (loan repayment) Loan balance - End of month Budgeted income statement for entire second quarter (not monthly). (Round your final answe ZIGBY MANUFACTURING Budgeted Income Statement For Three Months Ended June 30 Selling general and administrative expenses Total operating expenses 0 $ Budgeted balance sheet at June 30. (Round your final answers to the nearest whole dollar.) ZIGBY MANUFACTURING Budgeted Balance Sheet June 30 Assets 0 Total assets Liabilities and Equity Liabilities Equity Total Liabilities and Equity

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