Respuesta :
The budgeted cash receipts, the budgeted cash payments and the cash budget for Iguana are detailed as below.
How to compute budgeted cash payments?
1) We are given;
March April May June July August
Units Sales (a) 280 260 310 410 385 435
Selling Price (b) 30 30 30 30 30 30
Sales (a*b = c) 8,400 7,800 9,300 12,300 11,550 13,050
Thus, the budgeted cash receipts will be;
April May June July
Cash Sales (d = c*80%) 6,240 7,440 9,840 9,240
50% of Credit Sales(e = d*50%) = 780 930 1,230 1,155
50% of Credit Sales Collected
in the Following Month
f = previous month's sales * 50%) 840 780 930 1,230
Total Cash Receipts (g = d + e +f) 7,860 9,150 12,000 11,625
2) The total purchase cost would be;
April May June July
Unit Sales (a) 260 310 410 385
Ending Inventory (b = next month's sales * 40%) 124 164 154 174
Beginning Inventory
(c = current month's sales * 40%) -104 -124 -164 -154
Production (d = a + b - c) 280 350 400 405
Linear Feet per Unit (e) 4 4 4 4
Total Feet (f = d*e) 1,120 1,400 1,600 1,620
Ending Inventory
(g = next month's production * 30%) 420 480 486 313.20
Beginning Inventory
(h = current month's production * 30%) -336 -420 -480 -486
Total Purchases (i = f + g - h) 1204 1460 1606 1447.20
Cost per Feet (j) 2.5 2.5 2.5 2.5
Total Cost of Purchases (k = i*j) 3010 3650 4015 3618
The total labor cost is gotten as;
April May June July
Production (a) 280 350 400 405
Minutes (b) 30 30 30 30
Total Minutes(c = a*b) 8400 10500 12000 12150
Minutes per Hour (d) 60 60 60 60
Hours (e = c/d) 140 175 200 202.50
Rate per Hour(f) 12 12 12 12
Direct Labor Cost (g = e*f) 1680 2100 2400 2430
The schedule for cash disbursement is prepared below based on payment schedule given in the question;
April May June July
Direct Materials (a) 2,408 2920 3212 2894.40
Direct Materials in the Previous Month (b) 500 602 730 803
Direct Labor (c) 1680 2100 2400 2430
Variable Overhead (d)
(production per month * $0.40 per unit) 112 140 160 162
Fixed Overhead (e) ($650 monthly expense
- $160 depreciation expense) 490 490 490 490
Selling Expenses (f)($700 fixed +
Sales per month * $0.50 per unit) 830 855 905 892.50
Total Cash Disbursements (g = a+b+c+d+e+f) 6020 7107 7897 7671.90
C) The cash budget for Iguana is;
April May June July
Beginning Cash 10,900 10,640 12,683 16,786
Cash Receipts 7,860 9,150 12,000 11,625
Total Cash Available 18,760 19,790 24,683 28,411
Cash Disbursements -6,020 -7,107 -7,897 -7,671.90
Purchase of Equipment -3,100 0 0 0
Excess (deficiency) of cash available
over disbursements 9,640 12,683 16,786 20,739.10
Financing:
Loan Proceeds 1,000 0 0 0
Ending Cash Balance 10,640 12,683 16,786 20,739.1
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