MANAGERIAL ACCOUNTING - Fourth Edition

Solutions Manual

WASATCH MANUFACTURING
Master Budget

December
Unit Sales
Price per Unit
Sales Revenue

$
$

Cash Sales
Credit Sales
Total Cash Collection

Unit Sales
Plus: Desired Ending Inventory
Total needed
Less: Beginning Inventory
Units to produce

Chapter 9: The Master Budget

Sales Budget
January
February
7,000
8,000
9,000
15.00
### $
15.00 $
105,000 $
120,000 $
135,000 $

March
8,600
15.00
129,000

Cash Collections Budget

January
February
$
36,000 $
40,500 $
$
84,000 $
94,500 $
$
120,000 $
135,000 $

March
38,700
90,300
129,000

Production Budget
January
8000
1800
9800
1600
8200

February
9000
1720
10720
1800
8920

March
8600
1880
10480
1720
8760

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MANAGERIAL ACCOUNTING - Fourth Edition

Direct Materials Budget
January
8,200
4

Units to be produced
Multiply by: Quantity of DM per unit (lbs.)
Quantity of DM needed for production (lbs.)
Plus: Desired ending inventory of DM (lbs.)
Total quantity of DM needed (lbs.)
Less: Beginning inventory of DM (lbs.)
Quantity of DM to purchase (lbs.)
Multiply by: Cost per pound
Total cost of DM purchases

December Purchases (from A/P)

January Purchases
February Purchases
March Purchases
Total Cash Payments

$
$

32,800
5,352
38,152
4,920
33,232
1.00 $
33,232 $

February
8,920
4
35,680
5,256
40,936
5,352
35,584
1.00 $
35,584 $

Cash Payments for Direct Material Purchases Budget

January
February
$
37,000
$
8,308 $
24,924
$
8,896 $
$
$
45,308 $
33,820 $

Units Produced
Multiply by: Hours per Unit
Direct Labor Hours
Multiply by: Direct Labor Rate per Hour
Direct Labor Cost

Chapter 9: The Master Budget

Solutions Manual

Cash Payments for Direct Labor Budget

January
February
8,200
8,920
0.10
0.10
820
892
$
15.00 $
15.00 $
$
12,300 $
13,380 $

March
8,760
4
35,040
5,328
40,368
5,256
35,112
1.00
35,112

March

26,688
8,778
35,466

March
8,760
0.10
876
15.00
13,140

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MANAGERIAL ACCOUNTING - Fourth Edition

Chapter 9: The Master Budget

Solutions Manual

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MANAGERIAL ACCOUNTING - Fourth Edition

Solutions Manual

Cash Payments for Manufacturing Overhead Budget

January
February
Rent (fixed)
$
10,000 $
10,000 $
Other Manufacturing Overhead (fixed)
$
6,000 $
6,000 $
Variable Manufacturing Overhead Costs
Cash Payments for Manufacturing Overhead

11,150 $
27,150 $

10,950
26,950

Cash Payments for Operating Expenses Budget

January
February
Variable Operating Expenses
$
10,400 $
11,700 $
Fixed Operating Expenses
$
2,200 $
2,200 $
Cash Payments for Operating Expenses
$
12,600 $
13,900 $

March
11,180
2,200
13,380

Combined Cash Budget

January
February
$
17,000 $
26,542 $
$
120,000 $
135,000 $
$
137,000 $
161,542 $

March
37,292
129,000
166,292

Cash Balance, Beginning

Plus: Cash Collections
Total Cash Available
Cash Payments:
DM Purchases
Direct Labor
Manufacturing Overhead costs
Operating Expenses
Tax Payment
Equipment Purchases
less: Total Cash Payments
Ending Cash before Financing
Financing:
Chapter 9: The Master Budget

$
$

$
$
$
$
$
$
$

10,250 $
26,250 $

March
10,000
6,000

45,308
12,300
26,250
12,600
0
20,000
116,458
20,542

$
$
$
$
$
$
$
$

33,820
13,380
27,150
13,900
28,000
8,000
124,250
37,292

$
$
$
$
$
$
$

35,466
13,140
26,950
13,380
0
25,000
113,936
52,356

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MANAGERIAL ACCOUNTING - Fourth Edition

Borrowings
Repayments
Interest Payments
Cash Balance, Ending

Chapter 9: The Master Budget

Solutions Manual

0
0
0
20,542 $

0
0
0
37,292 $

0
0
0
52,356

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MANAGERIAL ACCOUNTING - Fourth Edition

Solutions Manual

Budgeted Manufacturing Cost per Unit

Direct materials cost per unit
Direct labor cost per unit
Variable manufacturing costs per unit
Fixed manufacturing overhead per unit
Cost of manufacturing each unit

Budgeted Income Statement

Sales Revenue
Less: Cost of goods sold
Gross Profit
Less: Operating expenses
Less: Depreciation expenses
Operating income
Less: interest expense
Less: income tax expense
Net income

Chapter 9: The Master Budget

$
$
$
$
$
$
$
$

384,000
192,000
192,000
35,480
10,000
146,520
0
33,700
112,820

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MANAGERIAL ACCOUNTING - Fourth Edition

$
$

April
9,400
15.00
141,000 $

Solutions Manual

May
6,800
###
102,000

Quarter
$
115,200
$
268,800
$
384,000

Quarter
April
25600
5400
31000
5120
25880

9400
1360
10760
1880
8880

Chapter 9: The Master Budget

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MANAGERIAL ACCOUNTING - Fourth Edition

Quarter
April
25,880
4

$
$

103,520
5,328
108,848
15,528
93,320
1.00
93,320

Solutions Manual

8880
4
35520

Quarter
$
37,000
$
33,232
$
35,584
$
8,778
$
114,594

$
$

Quarter
25,880
0.10
2,588
15.00
38,820

Chapter 9: The Master Budget

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MANAGERIAL ACCOUNTING - Fourth Edition

Chapter 9: The Master Budget

Solutions Manual

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MANAGERIAL ACCOUNTING - Fourth Edition

$
$

Quarter
30,000
18,000

$
$

32,350
80,350

$
$
$

Quarter
33,280
2,200
35,480

$
$
$

Quarter
80,834
384,000
464,834

$
$
$
$
$
$
$
$

114,594
38,820
80,350
35,480
28,000
53,000
350,244
114,590

Chapter 9: The Master Budget

Solutions Manual

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MANAGERIAL ACCOUNTING - Fourth Edition

Solutions Manual

0
0
0
114,590

Chapter 9: The Master Budget

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MANAGERIAL ACCOUNTING - Fourth Edition

$
$
$
$
$

Solutions Manual

4.00
1.50
1.25
0.75
7.50

Chapter 9: The Master Budget

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