Our controller, Veronica Verrengia, is negotiating with our bamboo suppliers in

Question

Our controller, Veronica Verrengia, is negotiating with our bamboo suppliers in China. We need the Softball Bat Division's Master Budget for 2018 for our corporate strategic planning process, and we cannot wait for Veronica's return from China. We would like you to prepare the Softball Bat Division's Master Budget for 2018 The deliverables are as follows 1. Sales budget, including a schedule of expected cash collections. 2. Production budget. 3. Direct materials budget, including a schedule of expected cash disbursements for materials. 4. Direct labor budget. 5. Manufacturing overhead budget, with a calculation of a pre-determined overhead rate 6. Ending finished goods inventory budget calculating the expected value of the finished goods inventory as of December 31, 2018. 7. Selling and administrative expense budget. 8. Cash budget. 9. Budgeted income statement for the year ended December 31, 2018. 10. Budgeted balance sheet for December 31, 2018. All the Master Budget schedules (except those marked with an asterisk) for the Softball Bat Division should include a column for each quarter and a total column for the fiscal year. We only need annual totals for the budgeted financial statements (schedules 9 and 10) and we only need a year-end total for the value of finished goods inventory (schedule 6). The hard copies of these budget schedules should be delivered by November 13, 2017. You can print more than one schedule per page, but do not have a page break in the middle of a budget schedule. We like to be able to view an entire budget schedule without flipping back and forth between pages. Please also use a type font of between 10-12 points for printing. We also need you to submit (via e-mail) the Excel spreadsheet that you used to create the budget schedules you print so we can use the spreadsheet as a starting point for future budgets. Send the Excel spreadsheet as an email attachment. We need that spreadsheet file by November 12, 2017 as we I've attached a brief description of the Softball Bat Division to the budget data Veronica gave me before she left for China. We eagerly await your results Sincerely Tom Verrengia Tom Verrengia, President

Explanation / Answer

3.

Please note per Chegg guidelines, 4 sub-parts have been answered.

1 Softball Bat Division Sales Budget For the Year 2018 Quarter 1 Quarter 2 Quarter 3 Quarter 4 Total Budgeted sales in units 71000 84000 76000 80000 311000 Unit selling price $                  82 $                  82 $                  82 $                  82 $                      82 Total Sales $ 5822000 6888000 6232000 6560000 25502000 Schedule of Expected Cash Collections Quarter 1 Quarter 2 Quarter 3 Quarter 4 Total Sales $ 5822000 6888000 6232000 6560000 25502000 Collections for: Previous quarter (35%) 1400000 2037700 2410800 2181200 8029700 Current quarter (65%) 3784300 4477200 4050800 4264000 16576300 Total cash collections $ 5184300 6514900 6461600 6445200 24606000 2 Softball Bat Division Production Budget For the Year 2018 Quarter 1 Quarter 2 Quarter 3 Quarter 4 Total Budgeted sales (units) 71000 84000 76000 80000 311000 Ending FG inventory as percent of next quarter's budgeted sales (units) 25% 25% 25% Budgeted ending inventory (units) 21000 19000 20000 20000 20000 Budgeted unit sales for month 71000 84000 76000 80000 311000 Required production (units) 92000 103000 96000 100000 331000 Beginning inventory (units) 0 21000 19000 20000 0 Budgeted production in units 92000 82000 77000 80000 331000 3 Softball Bat Division Direct Materials Budget For the Year 2018 Quarter 1 Quarter 2 Quarter 3 Quarter 4 Total Budgeted production in units 92000 82000 77000 80000 331000 Material required per unit of production (ounces) 40 40 40 40 40 Materials needed for production (ounces) 3680000 3280000 3080000 3200000 13240000 Ending DM inventory as percent of next quarter's production requirements (ounces) 10% 10% 10% Budgeted ending inventory (units) 328000 308000 320000 360000 360000 Materials needed for production (ounces) 3680000 3280000 3080000 3200000 13240000 Total DM required (ounces) 4008000 3588000 3400000 3560000 13600000 Beginning inventory (ounces) 409000 328000 308000 320000 409000 Materials to be purchased (ounces) 3599000 3260000 3092000 3240000 13191000 Material price per ounce $               0.90 $               0.90 $               0.90 $               0.90 $                   0.90 Total cost of direct material purchases $ 3239100 2934000 2782800 2916000 11871900 4 Softball Bat Division Direct Labor Budget For the Year 2018 Quarter 1 Quarter 2 Quarter 3 Quarter 4 Total Budgeted production in units 92000 82000 77000 80000 331000 Direct labor hours required per unit 0.85 0.85 0.85 0.85 0.85 Total labor hours needed 78200 69700 65450 68000 281350 Direct labor rate per hour $                  16 $                  16 $                  16 $                  16 $                      16 Direct labor cost $ 1251200 1115200 1047200 1088000 4501600

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