MANAGERIAL ACCOUNTING

Conrad Manufacturing
Master Budget- Accounting 2020
Alex Dickerson

Sales Budget
December January February March April May
Unit Sales 8,450 8,900 9,900 9,200 9,500 8,600
Price Per Unit 9 $ 9 $ 9 $ 9 $ 9 $ 9 $ 9
Sales Revenue $ 76,000 $ 80,100 $ 89,100 $ 82,800 $ 85,500 $ 77,400

Cash Collections Budget

January February March Quarter
Cash Sales 30% $ 24,030 $ 26,730 $ 24,840 $ 75,600
Credit Sales 70% $ 53,200 $ 56,070 $ 62,370 $ 171,640
Total Cash Collection $ 77,230 $ 82,800 $ 87,210 $ 247,240

Production Budget
Dec January February March Quarter
Unit Sales 8,445 8,900 9,900 9,200 28,000
Plus: Desired Inventory 0.10 990 920 950 2,860
Total Needed 8,445 9,890 10,820 10,150 30,860
Less: Beginning Inventory - (845) (890) (990) (2,725)

Units to Produce 8,445 9,046 9,930 9,160 28,136

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Direct Materials Budget

Dec January February March Quarter
Units to be Produced 8,445 9,046 9,930 9,160 28,136
Multiply by: Quantity of DM Needed per Unit
(lbs) 2 2 2 2 2
Quantity of DM Needed for Production 16,890 18,091.00 19,860 18,320 56,271
Plus: Desired Ending Inventory of DM (lbs) 0.20 3,972 3,664 3,800 11,436
Total Quantity of DM Needed (lbs) 16,890 22,063 23,524 22,120 67,707
Less: Beginning Inventory of DM (1,689) (3,972) (3,664)
Quantity of DM to Purchase 20,374 19,552 18,456 58,382
Multiply by: Cost per Pound $ 1.50 $ 1.50 $ 1.50 $ 1.50

Total Cost of DM Purchases $ 30,561 $ 29,328 $ 27,684 $ 87,573

Cash Payments for Direct Material Purchases Budget

0.7 0.3 January February March Quarter
December Purchases (from A/P) 22,000 $ 15,400 $ - $ -
January Purchases $ 9,168 $ 21,393 $ -
February Purchases $ - $ 8,798 $ 20,530
March Purchases $ - $ - $ 8,305

Total Cash Payments $ 24,568 $ 30,191 $ 28,835 $ 83,594

Cash Payments for Direct Labor Budget

January February March Quarter
Units Produced 9,046 9,930 9,160 28,136
Multiply by: Hours per Unit 0.03 0.03 0.03 0.03 0.03
Direct Labor Hours 271 298 275 844

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Multiply by: DL Rate per Hour 13 $ 13 $ 13 $ 13 $ 13

Direct Labor Cost $ 3,510 $ 3,834 $ 3,600 $ 10,944

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Cash Payments for Manufacturing Overhead Budget

January February March Quarter
Rent (Fixed) 6,500 $ 6,500 $ 6,500 $ 6,500 $ 19,500
Other Manufacturing Overhead (Fixed) $ 2,900 $ 2,900 $ 2,900 $ 2,900 $ 8,700
Variable Manufacturing Overhead Costs $ 1.40 $ 12,664 $ 13,902 $ 12,824 $ 39,390

Cash Payments for Manufacturing Overhead $ 22,064 $ 23,302 $ 22,224 $ 67,590

Cash Payments for Operating Expenses Budget

January February March Quarter
Variable Operating Expenses $ 1.20 $ 10,680 $ 11,880 $ 11,040 $ 33,600
Fixed Operating Expenses $ 1,400.00 $ 1,400 $ 1,400 $ 1,400 $ 4,200

Cash Payments for Operating Expenses $ 12,080 $ 13,280 $ 12,440 $ 37,800

Combined Cash Budget

January February March Quarter
Cash Balance, Beginning $ 6,000 $ 15,208 $ 5,001 $ 6,000
Plus: Cash Collections $ 77,230 $ 82,800 $ 87,210 $ 247,240
Total Cash Available $ 83,230 $ 98,008 $ 92,211 $ 273,449
Less Cash Payments:
DM Purchases $ 24,568 $ 30,191 $ 28,835 $ 83,594
Direct Labor $ 3,510 $ 3,834 $ 3,600 $ 10,944
Manufacturing Overhead costs $ 22,064 $ 23,302 $ 22,224 $ 67,590
Operating Expenses $ 12,080 $ 13,280 $ 12,440 $ 37,800
Tax Payment $ - $ 10,800 $ - $ 10,800
Equipment Purchases $ 5,800 $ 11,600 $ 15,800 $ 33,200
Total Cash Payments $ 68,022 $ 93,007 $ 82,899 $ 243,928

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Ending Cash before Financing $ 15,208 $ 5,001 $ 9,312

Financing:
Borrowings $ - $ - $ -
Repayments $ - $ - $ 1,000 $ 1,000
Interest Payments $ - $ - $ - $ -
Cash Balance, Ending $ 15,208 $ 5,001 $ 10,312 $ 10,312

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Budgeted Manufacturing Cost per Unit

Direct materials cost per unit $ 3.00
Direct labor cost per unit $ 0.39
Variable manufacturing costs per unit $ 1.40
Fixed manufacturing overhead per unit $ 0.60
Cost of manufacturing each unit $ 5.39

Budgeted Income Statement

Sales Revenue $ 252,000
Less: Cost of Goods Sold $ 150,920
Gross Profit $ 101,080
Less: Operating Expenses $ 37,800
Less: Depreciation Expense 5200
Operating Income $ 58,080
Less: Interest Expense $ -
Less: Income Tax Expense $ (5,462)
Net Income $ 52,618

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