The management of Zigby Manufacturing prepared the following estmated balance sh

Question

The management of Zigby Manufacturing prepared the following estmated balance sheet for March 2017: Estinated Balance Sheet Assets Cash $ 57,08 464,880 91,688 Raw materials inventory Finished goods inventory Total c Equipment, gross Accumulated depreciation 993,080 634,eee 167,888) 467,080 net Liabilities and Equity s 286, 3ee 29,eee Accounts payable Short-tern notes payable Long-term note payable Connon stock 352 , ??? Retained earnings To prepare a master budge: for Apri, May, and june of 2017, mansgement gathers the foliowing information a. Sales for Marcn total 28.200 unts. Forecasteo sales in unita are as follows: Apri, 23 200 May, 17100 June 21900 re fore astec for the

Explanation / Answer

Zigby Manufacturing Sales Budget for June 2017 quarter April May June Total March July Units 23200 17100 21900 62200 23200 23200 Selling Price 25 25 25 25 Entire year 257000 Sales 580000 427500 547500 1555000 Zigby Manufacturing Production Budget for June 2017 quarter April May June Total Next month's budgeted sales(units) 17100 21900 23200 Ratio of inventory to the future sales 80% 80% 80% Budgeted ending inventory(units) 13680 17520 18560 Budgeted units sales for month 23200 17100 21900 Required units of available production 36880 34620 40460 Beginning inventory (units) -18560 -13680 -17520 Units to be produced 18320 20940 22940 62200 Zigby Manufacturing Raw Materials Budget for June 2017 quarter April May June Total Production budget (units) 18320 20940 22940 March Materials requirements per unit 0.5 0.5 0.5 4580 Materials needed for production 9160 10470 11470 Budgeted ending inventory 5235 5735 5700 Total materials requirements (units) 14395 16205 17170 Beginning inventory 4580 5235 5735 Materials to be purchased 15050 16705 17135 48890 Material price per unit 20 20 20 20 Total cost of direct materials purchases 301000 334100 342700 977800 Zigby Manufacturing Direct Labor Budget for June 2017 quarter April May June Total Budgeted production (units) 18320 20940 22940 Labor requirements per unit (hours) 0.5 0.5 0.5 Total Labor hours needed 9160 10470 11470 31100 Labor rate (per hour) 13 13 13 Labor dollars 119080 136110 149110 404300 Zigby Manufacturing Factory overhead Budget for June 2017 quarter April May June Total Labor hours needed 9160 10470 11470 Variable factory overhead rate 4.4 4.4 4.4 Budgeted variable overhead 40304 46068 50468 136840 Budgeted fixed overhead 37320 37320 37320 111960 Budgeted total overhead 77624 83388 87788 248800 Zigby Manufacturing Selling Expense Budget for June 2017 quarter April May June Total Budgeted Sales 580000 427500 547500 1555000 Sales commission percent 5% 5% 5% 5% Sales commissions 29000 21375 27375 77750 Sales salaries 4700 4700 4700 14100 Total Selling expenses 33700 26075 32075 91850 Zigby Manufacturing General and administrative Expense Budget for June 2017 quarter April May June Total Salaries 29000 29000 29000 87000 Interest on long-term note 4160 4160 4160 12480 Total Expenses 33160 33160 33160 99480 Calculation of cash receipts from customers April May June Total Total budgeted Sales 580000 427500 547500 Cash Sales 20% 116000 85500 109500 Sales on credit 80% 464000 342000 438000 Total cash receipts from customers April May June Current month's cash sales 116000 85500 109500 Collection of receivables 464000 464000 342000 Total cash receipts 580000 549500 451500 Zigby Manufacturing Cash Budget for June 2017 quarter April May June Beginning cash balance 57000 175456 155543 Cash receipts from customers 580000 549500 451500 Total cash available 637000 724956 607043 Cash disbursements Payments for raw materials 206300 301000 334100 Payments for direct labor 119080 136110 149110 Payments for variable overhead 40304 46068 50468 Sales commissions 29000 21375 27375 Sales Salaries 4700 4700 4700 General & Administrative salaries 29000 29000 29000 Dividends 27000 Loan interest Long-term note interest 4160 4160 4160 Purchase of equipment 147000 Taxes paid 0 0 0 Total cash disbursement 432544 569413 745913 Preliminary cash balance 204456 155543 -138870 Additional loan(loan repayment) -29000 0 237870 Ending cash balance 175456 155543 99000 Zigby Manufacturing Budgeted Income statement for the quarter ended June 2017 Particulars Sales 1555000 Less : Cost of Goods Sold -892570 Gross Profit 662430 Fixed overhead(Depreciation) 111960 111960 Sales commission 77750 Sales salaries 14100 91850 Salary 87000 Interest on long term note 12480 Interest on short term note 0 191330 Net Profit 471100 Less : Tax @ 40% 188440 282660 Less : Dividend 27000 Transfer to retained earnings 255660 Cost of Goods Sold Sold 62200 Direct material 31100 20 622000 Direct Labor 15550 13 202150 Variable overhead 15550 4.4 68420 COGS 892570 Zigby Manufacturing Budgeted Balance sheet for the quarter ended June 2017 Assets Cash 99000 Accounts receivable 438000 Raw Materials Inventory 5700*20 114000 Finished goods inventory 18560*37.40 694144 Total Current assets 1345144 Equipement, gross 634000+147000 781000 Accumulated depreciation 167000+111960 278960 Equipement, net 502040 Total assets 1847184 Liabilities and Equity Accounts payable 342700 Short-term notes payable 237870 Income Tax payable 188440 Total current liabilities 769010 Long-term note payable 520000 Total Liabilities 1289010 Common Stock 352000 Retained Earnings 352700+255660 608360 Total stockholder's equity 960360 Total Liabilities and Equity 2249370

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