Accmana Exercises: The Master Budget

1) Loyal Pet Company expects to sell 5,000 beefy dog treats in January and 9,000 in February for $3 each.
What will be the total sales revenue reflected in the sales budget for those months?
2) Hewitt Company expects cash sales for July of $15,000, and a 22% monthly increase during August and
September. Credit sales of $10,000 in July should be followed by 30% increases during August and
September. What are budgeted cash sales and budgeted credit sales for September respectively?
What are budgeted cash sales and budgeted credit sales for September respectively?
3) Kotrick Company has beginning inventory of 15,000 units and expected sales of 23,000 units. If the
desired ending inventory is 18,000 units, how many units should be produced?
4) Rubino Corporation desires a December 31 ending inventory of 900 units. Budgeted sales for December
are 2,650 units. The November 30 inventory was 850 units. What are budgeted purchases in units?
5) Meers Corporation had beginning inventory of 21,000 units and expects sales of 76,500 units during the
year. Desired ending inventory is 19,500 units. How many units should Meers Corporation produce?
6) Warshaw Company budgets payroll at $3,600 per month plus a percentage of monthly sales. The June
operating expense budget includes total payroll of $13,200 with budgeted sales of $160,000. Sales for July
are budgeted at $180,000 while purchases of inventory for July are budgeted at $95,000. Depreciation and
insurance for July are estimated at $1,000 and $600, respectively. Office and administrative expenses
related to purchasing inventory are budgeted at 10% of purchases for the month. The purchase of $2,500
in equipment and $1,500 in furniture is expected in July. a) The July payroll should be budgeted at?
b) The total operating expenses budgeted for July are?
7) Natcher Corporation collects 30% of a month's sales in the month of sale, 55% in the month following
sale, and 10% in the second month following sale. The company has found that 5% of their sales are
uncollectible. Budgeted sales for the upcoming four months are:
August budgeted sales
September budgeted sales
October budgeted sales
November budgeted sales

$300,000
$280,000
$330,000
$260,000

The amount of cash that will be collected in November?

8) Einstein Company is preparing its cash budget for the upcoming month. The beginning cash balance
for the month is expected to be $14,000. Budgeted cash receipts are $84,000, while budgeted cash
disbursements are $72,000. Einstein Company wants to have an ending cash balance of $40,000. The
excess (deficiency) of cash available over disbursements for the month would be
9) BusyBody Company expects its November sales to be 20% higher than its October sales of $180,000.
Purchases were $110,000 in October and are expected to be $160,000 in November. All sales are on credit
and are collected as follows: 35% in the month of the sale and 60% in the following month. Purchases are
paid 40% in the month of purchase and 60% in the following month. The cash balance on November 1 is
$13,500. The cash balance on November 30 will be.

Final Project:
a) Identify a product and a possible export market for this product.
(Check the Euromonitor site for possible industry data regarding supply and demand)
b) Once the product and market was identified, prepare the following budgets
a) Projected Sales
b) Projected Production
c) Projected Labor Cost
d) Projected Factory Overhead
e) Projected Operating Expenses
Note: Make the product simple as the objective is for you to learn the process of budget preparation.