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Title: Problem 22-4B
QA_Ori:
Part 1
COMP-MEDIA
Budgeted Income Statement
For Months of July, August, and September, 2013
July August September
Sales* $1,265,000 $1,391,500 $1,530,650
Cost of goods sold* 660,000 726,000 798,600
Gross profit 605,000 665,500 732,050
* Volume for the next three months increases by 10% per month
Sales Cost of Goods
Units (@ $115) Sold (@ $60)
June ($1,300,000/$130) 10,000
Part 2: Analysis Component
The plan for increasing sales volume by reducing the price and increasing advertising
would cause the company to generate less net income in each of the three months of
Title: Problem 22-5B
QA_Ori:
Part 1
ISLE CORPORATION
Sales Budgets
January, February, and March 2014
Budgeted Budgeted Budgeted
Units Unit Price Total Dollars
January 2014 6,000 $45 $ 270,000
Part 2
ISLE CORPORATION
Merchandise Purchases Budgets
January, February, and March 2014
January February March Total
Next month’s budgeted sales 8,000 10,000 9,000
Ratio of inventory to future sales x 25% x 25% x 25%
Part 3
ISLE CORPORATION
Selling Expense Budgets
January, February, and March 2014
January February March Total
Budgeted sales $270,000 $360,000 $450,000
Part 4
ISLE CORPORATION
General and Administrative Expense Budgets
January, February, and March 2014
January February March Total
Salaries $12,000 $12,000 $12,000 $36,000
* Depreciation expense calculations
Annual
Amount January February March Total
Equipment owned
on 12/31/2013 $67,50
0
$5,625 $5,625 $5,625 $16,875
Part 5
ISLE CORPORATION
Capital Expenditures Budgets
January, February, and March 2014
January February March
Part 6
ISLE CORPORATION
Cash Budgets
January, February, and March 2014
January February March
Beginning cash balance $
36,000
$182,850 $ 107,850
Cash receipts from customers (note A) 382,500 421,500 355,500
Total cash available 418,500 604,350 463,350
Cash disbursements
0
Supporting calculations January February March Total
Note A: Cash receipts from customers
Total sales $270,000 $360,000 $450,000 $1,080,000
Cash sales (25%) $ 67,500 $ 90,000 $112,500 $ 270,000
00
0
0
Accounts payable at 12/31/2013 (20%;
80%)
$72,000 $288,0
00
$360,00
0
00
0
0
Part 7
ISLE CORPORATION
Budgeted Income Statement
For Three Months Ended March 31, 2014
Sales $1,080,000
Cost of goods sold (24,000 units @ $30) 720,000
Gross profit 360,000
Part 8
ISLE CORPORATION
Budgeted Balance Sheet
March 31, 2014
ASSETS
Cash $ 36,000 Cash budget
Accounts receivable 445,500 Note C
LIABILITIES AND EQUITY
Accounts payable $ 496,500 Note G
Bank loan payable 76,950 Cash budget
Supporting Footnotes
Note C
Beginning receivables $ 525,000
Note D
Beginning inventory $ 150,000
Note E
Beginning equipment $ 540,000
Note F
Note G
Beginning accounts payable $ 360,000
Note H
Title: Problem 22-6B
QA_Ori:
Part 1
NSA COMPANY
Production Budget (in units)
Second Quarter
Budgeted ending inventory (bats) 6,000
Add budgeted sales 250,000
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
Part 3
NSA COMPANY
Direct Labor Budget
Second Quarter
Units to be produced 248,000
Part 4
NSA COMPANY
Factory Overhead Budget
Second Quarter
Total labor hours needed 124,000
