A B C D E F

1
2 BIGBUD
3 Three-Month Master Budget
4
5 Thorny Corp.
6 Balance Sheet, December 31
7
8 Cash $41,700
9 Accounts receivable 192,000
10 Raw materials 102,240 What + Huh
11 Finished goods 64,400 Gizmo
12 Land 50,000
13 Plant and equipment $500,000
14 Less: accumulated depreciation 112,000 388,000
15 Total assets $838,340
16
17 Accounts payable to suppliers $40,000
18 Common Stock $100,000
19 Retained Earnings 698,340 798,340
20 Total liabilities and equity $838,340
21
22
23 Budgeted Gizmo sales in units
24 January 7,000
25 February 8,000
26 March 10,000
27 April 8,000
28 May 7,000
29 Selling price $65
30 Collections from customers
31 Collected in month of sale 40%
32 Collected the following month 60%
 A B C D E F
33 Desired finished goods inventory
34 (% of next month's unit sales) 20%
35 Desired raw material inventory
36 (% of next month's production needs) 25%
37 Raw material units needed to produce one Gizmo
38 What 5
39 Huh 3
40 Beginning inventory units & cost
41 Gizmo 1,400 $46.00 Finished goods
42 What 18,000 $4.00 Raw materials
43 Huh 10,800 $2.80 Raw materials
44 Purchases
45 Paid in the month of purchase 70%
46 Paid in the subsequent month 30%
47
48 Direct labor time to produce one Gizmo 0.5 hours
49 Cost of direct labor $24 per hour
50 Factory overhead $12 per direct labor hr.
51
52 Selling and administrative expenses $10,000 fixed
53 10% variable projected sales dollars
54 Plant and equipment depreciation $12,000 per year \
55
Sales Budget
January February March
Budgeted Gizmo Sales in Unit 7,000 8,000 10,000
Price per unit $65 $65 $65
Budgeted Sales in Dollars $455,000 $520,000 $650,000
Total
25,000
$65
###
Collections Budget
January February March
Accounts Receivable $ 192,000
January Sales $ 182,000 $ 273,000
February Sales $ 208,000 $ 312,000
March Sales $ 260,000
Total 374,000 481,000 572,000

Ending AR $273,000 $312,000 $390,000

Total
$ 192,000
$ 455,000
$ 520,000
$ 260,000
1,427,000
Production Budget
January Fabruary March
Budgeted sales in Units 7,000 8,000 10,000
Desired Ending Inventory 1600 2000 1600
Total Needs 8,600 10,000 11,600
less Beginning Inventory 1,400 1600 2000
Required Production 7,200 8,400 9,600
Total
25,000
1600
26,600
1,400
28,000
Direct Materials WHAT
January February March
Required production 7,200 8,400 9,600
Raw materials needed per unit 5 5 5
Production needs 36,000 42,000 48,000
Add desired ending inventory 10,500 12,000 9,000
Total needs 46,500 54,000 57,000
less Beginning inventory 18,000 10,500 12,000
Materials to be purchased 28,500 43,500 45,000

Cost per WHAT $ 4.00 $ 4.00 $ 4.00

Cost of purchases $ 114,000 $ 174,000 $ 180,000

Cost of WHAT + HUH 161,880 247,080 255,600

 Direct Materials HUH
Total January
25,200 Required production 7,200
5 Raw materials needed per unit 3
126,000 Production needs 21,600
9,000 Add desired ending inventory 6,300
135,000 Total needs 27,900
18,000 less Beginning inventory 10,800
117,000 Materials to be purchased 17,100

$ 4.00 Cost per HUH 2.8

$ 468,000 Cost of purchases 47,880

664,560
February March Total
8,400 9,600 25,200
3 3 3
25,200 28,800 75,600
7,200 5,400 5,400
32,400 34,200 81,000
6,300 7,200 10,800
26,100 27,000 70,200

2.8 2.8 2.8

73,080 75,600 196,560
Purchasing Schedule
January February March
Accounts Payable 40,000
Jan Purchases 113,316 48,564
Feb Purchases 172,956 74,124
Mar Purchases 178,920
Total cash disbursment 153,316 221,520 253,044
Total
40,000
161,880
247,080
178,920
627,880
Direct Labor
January February March Total
Units to be produced 7,200 8,400 9,600 25,200
Direct labor time per uni 0.5 0.5 0.5 0.5
Total hours needed 3,600 4,200 4,800 12,600
Cost per hour 24 24 24 24
Total direct labor cost 86,400 100,800 115,200 302,400
Manufacturing Overhead
January February March
Required direct labor hours 3,600 4,200 4,800
Variable overhead rate 12 12 12
Variable manufacturing overhead 43,200 50,400 57,600
Fixed manufacturing overhead - - -
Total Manufacturing overhead 43,200 50,400 57,600
Less depreciation 1,000 1,000 1,000
Cash disbursements of MOH 42,200 49,400 56,600
Total
12,600
12
151,200
-
151,200
3,000
148,200
Selling and Admin expense
January February
Budgeted Sales in dollars 455,000 520,000
Variable Selling and Admin expense rate 10% 10%
Total variable expense 45,500 52,000
Total fixed expenses 10,000 10,000
Total selling and admin expenses 55,500 62,000
Less depreciation - -
Cash disbursement 55,500 62,000
March Total
650,000 1,625,000
10% 10%
65,000 162,500
10,000 30,000
75,000 192,500
- -
75,000 192,500
Ending Inventory
Quantity Cost Total
Direct materials (WHAT) 5 4 20
Direct Materials (HUH) 3 2.8 8.4
Direct Labor 0.5 24 12
Manufacturing Overhead 0.5 12 6
Unit Product cost 46.4
Ending finished goods in units 1600
Ending Finished goods in Dollars 74240

Ending Finished Goods

January February March
Ending Finished Goods in Units 1600 2000 1600
Unit Product cost 46.4 46.4 46.4
Ending Finished Goods in Dollar 74240 92800 74240
Total
1600
46.4
74240
Cash Budget
January February March
Cash balance beginning 41,700 78,284 125,564
Cash collections 374,000 481,000 572,000
Cash Available 415,700 559,284 697,564
Less Cash Disbursements:
Direct Materials 153,316 221,520 253,044
Direct Labor 86,400 100,800 115,200
Manufacturing Overhead 42,200 49,400 56,600
Selling and Admin Expen 55,500 62,000 75,000
Total Disbursements 337,416 433,720 499,844
Excess of cash 78,284 125,564 197,720
Total
245,548
1,427,000
1,672,548

627,880
302,400
148,200
192,500
1,270,980
401,568
Income Statement
January February March
Sales Revenue $455,000 $520,000 $650,000
Less COGS $324,240 $371,200 $464,000
Selling and admin expense $55,500 $62,000 $75,000
Net income $75,260 $86,800 $111,000

Cost of Goods Sold

January February March
Beginning finished goods 64,400 74240 92800
Budgeted sales units 7,000 8,000 10,000
Beg inv units 1,400 1600 2000
product cost 46.4 46.4 46.4
COGS $ 324,240 $ 371,200 $ 464,000
Total
$1,625,000
$1,159,440
$192,500
$273,060
Balance Sheet
January February March
Cash $ 78,284 $ 125,564 $ 197,720
Accounts receivable 273,000 312,000 390,000
Raw materials $ 59,640 $ 68,160 $ 51,120
Finished goods $ 74,240 $ 92,800 $ 74,240
Land 50,000 50,000 50,000
Plant and equipment $ 500,000 $ 500,000 $ 500,000
Less: accumulated depreciatio $ 113,000 $ 114,000 $ 115,000
Total assets $ 922,164 $ 1,034,524 $ 1,148,080

Accounts payable to suppliers $ 48,564 $ 74,124 $ 76,680

Common Stock $ 100,000 $ 100,000 $ 100,000
Retained Earnings 773,600 860,400 971,400
Total liabilities and equity $ 922,164 $ 1,034,524 $ 1,148,080