1. Weltin Industrial Gas Corporation supplies acetylene and other compressed gases to industry. Data regarding the store's operations follow: ? Sales are budgeted at $390,000 for November, $370,000 for December, and $380,000 for January. ? Collections are expected to be 90% in the month of sale, 5% in the month following the sale, and 5% uncollectible. ? The cost of goods sold is 60% of sales. ? The company purchases 70% of its merchandise in the month prior to the month of sale and 30% in the month of sale. Payment for merchandise is made in the month following the purchase. ? Other monthly expenses to be paid in cash are $21,800. ? Monthly depreciation is $18,000. ? Ignore taxes. Required: a. Prepare a Schedule of Expected Cash Collections for November and December. b. Prepare a Merchandise Purchases Budget for November and December. c. Prepare Cash Budgets for November and December. d. Prepare Budgeted Income Statements for November and December. e. Prepare a Budgeted Balance Sheet for the end of December. 2. Gokey Inc. bases its manufacturing overhead budget on budgeted direct labor-hours. The variable overhead rate is $5.10 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $78,840 per month, which includes depreciation of $20,520. All other fixed manufacturing overhead costs represent current cash flows. The November direct labor budget indicates that 5,400 direct labor-hours will be required in that month. Required: a. Prepare a report showing the cash disbursement for manufacturing overhead for November. b. Determine the predetermined overhead rate for November. Show your calculation. 3. A sales budget is given below for one of the products manufactured by the Key Co.: The inventory of finished goods at the end of each month must equal 20% of the next month's sales. On December 31, the finished goods inventory totaled 4,000 units. Each unit of product requires three specialized electrical switches. Since the production of these specialized switches by Key's suppliers is sometimes irregular, the company has a policy of maintaining an ending inventory at the end of each month equal to 30% of the next month's production needs. This requirement had been met on January 1 of the current year. Required: Prepare a budget in good form showing the quantity of switches to be purchased each month for January, February, and March and in total for the quarter.
Paper#5510 | Written in 18-Jul-2015Price : $25