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Garza and Neely, CPAs, are preparing their service revenue (sales) budget for the coming year




Question;Garza and;Neely, CPAs, are preparing their service revenue (sales) budget for the coming;year (2014). The practice is divided into three departments: auditing, tax, and;consulting. Billable hours for each department, by quarter, are provided below.;Department;Quarter 1;Quarter 2;Quarter 3;Quarter 4;Auditing;2,430;1,910;2,210;2,770;Tax;3,360;2,740;2,110;2,890;Consulting;1,630;1,630;1,630;1,630;Average hourly billing rates are auditing $85, tax $92, and consulting $105.Prepare the service revenue (sales) budget for 2014 by listing the departments;and showing for each quarter and the year in total, billable hours, billable;rate, and total revenue.Turney;Company produces and sells automobile batteries, the heavy-duty HD-240. The;2014 sales forecast is as follows.;Quarter;HD-240;1;5,300;2;7,220;3;8,110;4;10,410;The January 1, 2014, inventory of HD-240 is 2,120 units. Management;desires an ending inventory each quarter equal to 40% of the next quarter?s;sales. Sales in the first quarter of 2015 are expected to be 25% higher than;sales in the same quarter in 2014.Prepare quarterly production budgets for each quarter and in total for 2014.Glendo;Farm Supply Company manufactures and sells a pesticide called Snare. The;following data are available for preparing budgets for Snare for the first 2;quarters of 2014.;1.;Sales: Quarter 1, 29,000 bags, quarter;2, 43,500 bags. Selling price is $61 per bag.;2.;Direct materials: Each bag of Snare requires 4 pounds;of Gumm at a cost of $4 per pound and 7 pounds of Tarr at;$1.75 per pound.;3.;Desired inventory levels;Type of Inventory;January 1;April 1;July 1;Snare (bags);8,100;12,200;18,300;Gumm (pounds);9,300;10,400;13,200;Tarr (pounds);14,300;20,100;25,300;4.;Direct labor: Direct labor time is 15 minutes per bag at an;hourly rate of $16 per hour.;5.;Selling and administrative expenses are expected to be 15% of;sales plus $178,000 per quarter.;6.;Income taxes are expected to be 30% of income from operations.Complete questions are available in the attachment.;="msonormal">


Paper#37850 | Written in 18-Jul-2015

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