Primary Supplies Limited Company

Budgeted Balance Sheet as at December 31 20X11

Plant and equipment (net of accumulated depreciation)
$
Cash
Accounts receivable

105,500,000
10,695,000
15,000,000

Inventory:
Raw material
Finished goods
Total assets

4,931,250
5,344,500
141,470,750
=============

Accounts payable
Common stock
Retained earnings
Total liabilities and stockholders equity

14,287,500
64,625,670
62,557,580
141,470,750
=============

Manufacturing Cost Per Unit

Windows
Ditect Materials
Wood: Window: 1/2 ft. @ $150 per foot
Door: 10 ft. @ $150 per foot
Glass sheets: Window: 1 sheet @ $250 per sheet
Door: 1/5 sheet @ $250 per sheet
0.1 hour @ $400 per hour
Direct labour:
0.1 direct-labour hour x $200 per hour
Manufacture overhead
Total manufacturing cost per unit

75

250

40

20

385

Doors

1,500

50
40
20

1,610

Sales Budget
Expected Growth in Sales Unit

1000

Unit Selling price for S Frame

Unit Selling price for L Frame

$1,000
$5,000

20X11
4th Quarter

20X12
2nd Quarter
3rd Quarter

1st Quarter

4th Quarter

Total

Windows
Expected Sales in Unit
* Unit Selling Price
Total sales for windows

$
$

50,000
1,000
50,000,000

$
$

51,000
1,000
51,000,000

$
$

52,000
1,000
52,000,000

$
$

53,000
1,000
53,000,000

$
$

54,000
1,000
54,000,000

$
$

210,000
1,000
210,000,000

$
$

20,000
5,000
100,000,000

$
$

21,000
5,000
105,000,000

$
$

22,000
5,000
110,000,000

$
$

23,000
5,000
115,000,000

$
$

24,000
5,000
120,000,000

$
$

90,000
5,000
450,000,000

Doors
Expected Sales in Unit
* Unit Selling Price
Total sales for doors
Total Sales for both windows and
doors

$150,000,000

$156,000,000

$162,000,000

$168,000,000

$174,000,000

$660,000,000

Schedule of Expected Cash Collection

Credit Sales

50%

Credit Sales collected during

quarter of sale
Credit Sales collected in following
quarter of sale

Credit Sales

80%
20%

1st Quarter
$
78,000,000

20X5
2nd Quarter
3rd Quarter
$
81,000,000 $
84,000,000

4th Quarter
87,000,000

Total
330,000,000

RECEIPTS FROM CUSTOMERS

Cash Sales

78,000,000

81,000,000

84,000,000

87,000,000

330,000,000

$
$

62,400,000
15,000,000

$
$

64,800,000
15,600,000

$
$

67,200,000
16,200,000

$
$

69,600,000
16,800,000

$
$

264,000,000
63,600,000

155,400,000

161,400,000

167,400,000

173,400,000

657,600,000

Receipts from Debtors:

In quarter of sale
One quarter after sale
Total Cash Collection from
Debtors

Production Budget
Desired Ending Inventory

10%

20X11
4th Quarter

1st Quarter

20X12
2nd Quarter
3rd Quarter

4th Quarter

Total

Windows
Budgeted Sales in Units
Desired Ending Inventory
Total Units Needed
Beginning Inventory
Units to be Produced for Windows

50,000
5,100
55,100
(5,000)
50,100

51,000
5,200
56,200
(5,100)
51,100

52,000
5,300
57,300
(5,200)
52,100

53,000
5,400
58,400
(5,300)
53,100

54,000
5,500
59,500
(5,400)
54,100

210,000
21,400
231,400
(21,000)
210,400

Budgeted Sales in Units

Desired Ending Inventory
Total Units Needed
Beginning Inventory
Units to be Produced for Doors

20,000
2,100
22,100
(2,000)
20,100

21,000
2,200
23,200
(2,100)
21,100

22,000
2,300
24,300
(2,200)
22,100

23,000
2,400
25,400
(2,300)
23,100

24,000
2,500
26,500
(2,400)
24,100

90,000
9,400
99,400
(9,000)
90,400

Total Units to be produced for both

Windows and Doors

70,200

72,200

74,200

76,200

78,200

Doors

300,800

Direct Material Budget

Windows
Wood
Price per foot
Glass Sheet required per unit
Price per sheet

Doors
0.5
150 $

10
150

1
250 $

0.2
250

Desire ending inventory for glass sheet

Desire ending inventory for wood

10%
10%
20X11
4th Quarter

20X12
2nd Quarter
3rd Quarter

1st Quarter

4th Quarter

Wood for Windows

Units to be Produced
Material required per unit

50,100
1

51,100
1

52,100
1

53,100
1

54,100
1

Quantity of wood to be purchased for windows

25,050

25,550

26,050

26,550

27,050

20,100
10

21,100
10

22,100
10

23,100
10

24,100
10

201,000

211,000

221,000

231,000

241,000

226,050
23,655
249,705
22,605
227,100
150
34,065,000

236,550
23,655
260,205
23,655
236,550
150
35,482,500

247,050
24,705
271,755
24,705
247,050
150
37,057,500

257,550
25,755
283,305
25,755
257,550
150
38,632,500

268,050
26,805
294,855
26,805
268,050
150
40,207,500

Woods for Doors

Units to be Produced
Material required per unit
Quantity of wood to be purchased for windows
Total quantity of wood to be purchsed for
windows and doors
Desired ending inventory
Total Quantity of direct materials needed
Beginning inventory of direct materials
Quantity of Direct Materials produced
Price per foot
Total purchases of wood

$
$

$
$

$
$

$
$

$
$

Glass Sheets Windows

Units to be Produced
Material required per unit
Quantity of glass sheets needed for production
of windows

50,100
1

51,100
1

52,100
1

53,100
1

54,100
1

50,100

51,100

52,100

53,100

54,100

Glass Sheets for Doors

Units to be Produced
Material required per unit
Quantity of glass sheets needed for production
of doors
Total Quantity of glass sheets needed for
production for windows and doors
Desired ending inventory of glass sheet
Total quantity of glass sheets needed
Beginning inventory of glass sheet
Quantity of glass sheets to be purchased
* Price per sheet
Total purchases of glass sheets
Total Purchases of Direct Material

20100
0.2

21100
0.2

22100
0.2

23100
0.2

24100
0.2

4020

4220

4420

4620

4820

$
$

54,120
5,532
59,652
(5,412)
54,240
250 $
13,560,000 $

55,320
5,652
60,972
(5,532)
55,440
250 $
13,860,000 $

56,520
5,772
62,292
(5,652)
56,640
250 $
14,160,000 $

57,720
5,892
63,612
(5,772)
57,840
250 $
14,460,000 $

58,920
10,400
69,320
(5,892)
63,428
250
15,857,000

47,625,000

49,342,500

51,217,500

53,092,500

56,064,500

Total
210,400
1
105,200

90,400
10
904,000

$
$

1,009,200
100,920
1,110,120
100,920
1,009,200
150
151,380,000

210,400
1
210,400

90400
0.2
18080

$
$
$

228,480
27,716
256,196
(22,848)
233,348
250
58,337,000
209,717,000

Schedule of Expected Cash Disbursement

Credit Purchases Payment during
quarter of purchase
Credit Purchases Payment in
following quarter of purchase

Credit Purchases

70%
30%
20X11
4th Quarter
$
47,625,000

1st Quarter
$
49,342,500

20X12
2nd Quarter
3rd Quarter
$
51,217,500 $
53,092,500

4th Quarter
56,064,500

Total
209,717,000

PAYMENTS TO SUPPLIER OF DIRECT MATERIAL

Payments to Supplier:
In quarter of purchase
One quarter after purchase
Total Cash Disbursement to
Suppliers

$
$

34,539,750
14,287,500

$
$

35,852,250
14,802,750

$
$

37,164,750
15,365,250

$
$

39,245,150
15,927,750

$
$

146,801,900
60,383,250

48,827,250

50,655,000

52,530,000

55,172,900

207,185,150

Direct Labour Budget

Labour Hour required per unit
Standard Labour Hour Rate per unit

Units to be produced
Labour hour required per unit
Total Labour Hour needed for
production
Standard Labour Hour Rate per unit
Total Labour Cost

0.1
400
20X12
2nd Quarter
3rd Quarter
74,200
76,200
0.1
0.1

1st Quarter
72,200
0.1

$
$

7,220
400
2,888,000

$
$

7,420
400
2,968,000

$
$

7,620
400
3,048,000

4th Quarter
78,200
0.1

$
$

7,820
400
3,128,000

Total
300,800
0.1

$
$

30,080
400
12,032,000

Manufacturing Overhead Budget

Indirect Material
Indirect Labour
Other Overhead
Depreciation
Total Overhead Cost

$
$
$
$
$

1st Quarter
900,000
800,000
600,000
400,000
2,700,000

$
$
$
$
$

20X5
2nd Quarter
3rd Quarter
950,000 $
960,000
900,000 $
950,000
500,000 $
600,000
400,000 $
400,000
2,750,000 $
2,910,000

$
$
$
$
$

4th Quarter
990,000
980,000
400,000
400,000
2,770,000

$
$
$
$
$

Total
3,800,000
3,630,000
2,100,000
1,600,000
11,130,000

Year
20X11

Quarters

20X12

R2
Variable Cost per Unit
Fixed Cost

1
2
3
4
1
2
3

S & L Units
50,000
45,000
38,000
65,000
55,000
48,000
65,000
366,000

Selling and Administration Cost

6,800,000.00
6,700,000.00
5,700,000.00
8,600,000.00
8,000,000.00
6,800,000.00
8,800,000.00
$51,400,000.00
96.54%
$111.24
$1,526,682

Selling and Administrative Budget

Units to be sold
Variable Selling & Administrative Cost
per unit
Total Variable Selling & Administrative
Cost
Fixed Cost
Total Selling and Administration Cost

20X12
2nd Quarter
3rd Quarter
74000
76000

1st Quarter
72000

4th Quarter
78000

Total
300000

111.24

111.24

111.24

111.24

111.24

$
$

8,009,159
1,526,682

$
$

8,231,636
1,526,682

$
$

8,454,112
1,526,682

$
$

8,676,589
1,526,682

$
$

33,371,495
6,106,729

9,535,841

9,758,318

9,980,794

10,203,271

39,478,224

Cash Budget
20X5
1st Quarter

2nd Quarter

3rd Quarter

4th Quarter

Total

Receipts:
From Customers
Total receipts

$
$

155,400,000
155,400,000

$
$

161,400,000
161,400,000

$
$

167,400,000
167,400,000

$
$

173,400,000
173,400,000

$
$

657,600,000
657,600,000

$
$
$
$
$
$
$
$
$
$

48,827,250
9,535,841
2,888,000
2,300,000
10,000,000
2,500,000
76,051,091
79,348,909
10,695,000
90,043,909

$
$
$
$

50,655,000
9,758,318
2,968,000
2,350,000

$
$
$
$

52,530,000
9,980,794
3,048,000
2,510,000

$
$
$
$

55,172,900
10,203,271
3,128,000
2,370,000

$
$
$
$
$

2,500,000
68,231,318
93,168,682
97,168,909
190,337,591

$
$
$
$
$

2,500,000
70,568,794
96,831,206
187,556,341
284,387,547

$
$
$
$
$

2,500,000
73,374,171
100,025,829
281,700,047
381,725,876

$
$
$
$
$
$
$
$
$
$

207,185,150
39,478,224
12,032,000
9,530,000
10,000,000
10,000,000
288,225,374
369,374,626
95,000
369,469,626

$
$
$
$

10,000,000
(2,500,000) $
(375,000) $
97,168,909 $

Payments:
Payments to suppliers
Selling and Administration
Direct labour cost
Manufacturing overhead cost
Purchase of Equipment
Dividend
Total Payment
Net inflow/outflow
Add:opening cash balance
Excess/Deficiency cash

Financing:
Borrowing
Repayment
Interest payment
Ending Cash balance
Notes:
Interest (Reducing Balance Method)

15%

(2,500,000) $
(281,250) $
187,556,341 $

(2,500,000) $
(187,500) $
281,700,047 $

$
(2,500,000) $
(93,750) $
379,132,126 $

10,000,000
(10,000,000)
(937,500)
368,532,126

Premium Suppliers Limted

Cost of Goods Manufactured and Sold Budget
For the year ended December 31, 20X12
Opening Stock of Direct Material
Purchases of Direct Materials
Closing Stock of Direct Materials
Total Cost of Direct Material Used
Direct Labour
Manufacturing Overheads
Total Cost of Goods Manufactured
Opening Stock of Finished Goods
Closing Stock of Finished Goods
Cost of Goods Sold

$
$
$
$
$
$
$
$
$
$

4,931,250
209,717,000
(83,200)
214,565,050
12,032,000
11,130,000
237,727,050
5,344,500
2,117,500
240,954,050

Premium Supplies Limted

Budgeted Income Statement
For the year ended December 31, 20X12
Sales
Cost of Goods Sold
Gross Profit
Selling and Administrative Expense
Profit Before Interest and Tax
Interest
Budgeted Net Income

$
$
$
$
$
$
$

660,000,000
(240,954,050)
419,045,950
(39,478,224)
379,567,726
(937,500)
378,630,226

Premium Supplies Limited

Budgeted Retained Earnings Statement
For the year ended December 31, 20X5
Retained Earnings (December 31, 20X4)
Budgeted Net Income
Dividends
Retained Earnings (December 31, 20X5)

$
$
$
$

62,557,580
378,630,226
(10,000,000)
(306,072,646)

Premium Supplies Limited

Budgeted Balance Sheet as at December 31, 20x12
Fixed Assets
Plant and Equipment
Equipment
Depreciation

$
$
$
$

105,500,000
10,000,000
(1,600,000)
113,900,000

Current Assets
Raw Material Stock
Finished Goods Stock
Debtors
Cash
Total Assets

$
$
$
$

83,200
(2,117,500)
17,400,000
368,532,126 $
$

383,897,826
497,797,826

16,819,350

Current Liabilities
Creditors

Financed By:
Common Stock
Retained Earnings

$
$

64,625,670
(306,072,646) $
$

(241,446,976)
(224,627,626)