Problem 22-8A (Continued)
Part 4
DIMSDALE SPORTS CO.
General and Administrative Expense Budgets
January, February, and March 2016
January February March Total
Salaries……………………..…….….…….….…….$12,000 $12,000 $12,000 $36,000
Maintenance………………….….…….….…….…2,000 2,000 2,000 6,000
* Depreciation expense calculations
Annual
Amount January February March Total
Equipment owned
on 12/31/2015....…..…....….. $67,500 $5,625 $5,625 $5,625 $16,875
Purchased in January......... 4,500 375 375 375 1,125
Part 5
DIMSDALE SPORTS CO.
Capital Expenditures Budgets
January, February, and March 2016
January February March
Equipment purchases……………………………………$36,000 $96,000 $ 28,800
Problem 22-8A (Continued)
Part 6
DIMSDALE SPORTS CO.
Cash Budgets
January, February, and March 2016
January February March
Beginning cash balance…………….…….….…….….$ 36,000 $ 30,100 $210,300
Cash receipts from customers (note A)..….…....... 221,250 697,000 489,500
General & administrative salaries……….….......12,000 12,000 12,000
Maintenance expense………………………….….….. 2,000 2,000 2,000
Interest ($15,000 x 1%)..…..…..….………………………. 150
Taxes payable……………………………………..….….. 90,000
Purchases of equipment……..…….….…….….…..36,000 96,000 28,800
Ending cash balance……………………………………..$ 30,100 $210,300 $143,400
Loan balance, end of month…………………………..$ 0 $ 0 $ 0
Supporting calculations January February March Total
Note A: Cash receipts from customers
Total sales……………………..….……..…………..….$385,000 $495,000 $605,000 $1,485,000
Second month (40%)……………..…………..…….._______ _______ 115,500 115,500
Total from credit customers….……………..……. 125,000 573,250 338,250 1,036,500
Cash sales…………….……………..……….…..…….. 96,250 123,750 151,250 371,250
Total cash received….……………..………….……..$221,250 $697,000 $489,500 $1,407,750
Note B: Cash payments for merchandise
Problem 22-8A (Continued)
Part 7
DIMSDALE SPORTS CO.
Budgeted Income Statement
For Three Months Ended March 31, 2016
Sales salaries……………………………………..…….….…….. 15,000
General administrative salaries………………………….... 36,000
Maintenance expense……………………………………….…. 6,000
Depreciation expense……………………………………….…. 20,300
Part 8
DIMSDALE SPORTS CO.
Budgeted Balance Sheet
March 31, 2016
ASSETS
Cash…………………………….…….….…….….…. $ 143,400 Cash budget
Accounts receivable…………..…….….……... 602,250 Note C
LIABILITIES AND EQUITY
Accounts payable.…..………………………….. $ 549,600 Note G
Bank loan payable……………………………….. 0 Cash budget
Taxes payable (due 4/15/2016)….….….…… 120,220 Income stmt.
Problem 22-8A (Concluded)
Supporting Footnotes
Note C
Beginning receivables…………………………………………..…..$ 525,000
Credit sales……………………………………………….……….……. 1,113,750
Less cost of goods sold……………………………………….…... (810,000)
Ending inventory*……………………………………….….………...$ 60,000
*Also equals 2,000 units @ $30 = $60,000
Note E
Beginning equipment…………..……..…….……...…....…....….$ 540,000
Beginning accumulated depreciation…......…....…....…....$ 67,500
Depreciation expense…………………………………………….…. 20,300
Total……………………………………………………………….…….….$ 87,800
Note G
Beginning accounts payable………….………....…....…....….$ 360,000
Net income…………………………………………….…….……….…. 180,330
Total……………………………………………………………….…….….$ 426,330
PROBLEM SET B
Problem 22-1B (30 minutes)
Part 1
NSA COMPANY
Production Budget (in units)
Second Quarter
Budgeted ending inventory (bats)…………………………………………….….. 6,000
Part 2
NSA COMPANY
Direct Materials Budget (in lbs, except where noted)
Second Quarter
Materials (aluminum) needed for production (248,000 x 3)…………. 744,000
Materials cost per pound……………………………………………………….…. $4
Total cost of materials purchases (741,000 x $4)…………….….……...$2,964,000
Problem 22-1B (concluded)
Part 3
NSA COMPANY
Direct Labor Budget
Second Quarter
Units to be produced…………………………………………….….….… 248,000
Labor requirements per unit (hours)……………………………….. x 0.50
Labor dollars………………………………………………….….….…….… $2,232,000
Part 4
NSA COMPANY
Factory Overhead Budget
Second Quarter
Total labor hours needed……………………………….….…….….…. 124,000
Variable overhead rate per direct labor hour..….…….…........ x $12
Problem 22-2B (30 minutes)
(1)
A1 MANUFACTURING
Cash Receipts Budget
For July, August, and September
July August Sept.
Sales…………………………………….….…….….…. $63,400 $80,600 $48,600
Less ending accts. receivable (80%).......... 50,720 64,480 38,880
Total cash receipts ………..….….…….….……..$59,680 $66,840 $74,200
Problem 22-2B (continued)
(2)
A1 MANUFACTURING
Cash Budget
For July, August, and September
July August Sept.
Beginning cash balance*…………….….……... $12,900 $12,600 $24,371
Cash receipts (from part 1)……………..….….. 59,680 66,840 74,200
Total cash available …………………….…….….. 72,580 79,440 98,571
Cash disbursements
Interest on bank loan**
July ($2,600 x 1%)……………………….….…...
August ($2,286 x 1%)…………………………...
Preliminary cash balance ……….….…….......
26
_______
$12,914
23
$26,657
_______
$48,211
Additional loan from bank……….….…….…...
** Rounded to the nearest dollar. Answers vary slightly if rounded to the nearest cent.