Question

In: Finance

Bombs Away Video Games Corporation has forecasted the following monthly sales:    January $ 97,000 July...

Bombs Away Video Games Corporation has forecasted the following monthly sales:
  

January $ 97,000 July $ 42,000
February 90,000 August 42,000
March 22,000 September 52,000
April 22,000 October 82,000
May 17,000 November 102,000
June 32,000 December 120,000
Total annual sales = $720,000


Bombs Away Video Games sells the popular Strafe and Capture video game. It sells for $5 per unit and costs $2 per unit to produce. A level production policy is followed. Each month's production is equal to annual sales (in units) divided by 12.


Of each month's sales, 30 percent are for cash and 70 percent are on account. All accounts receivable are collected in the month after the sale is made.


a. Construct a monthly production and inventory schedule in units. Beginning inventory in January is 22,000 units.
  

b. Prepare a monthly schedule of cash receipts. Sales in December before the planning year are $100,000.

c. Prepare a cash payments schedule for January through December. The production costs of $2 per unit are paid for in the month in which they occur. Other cash payments, besides those for production costs, are $42,000 per month.

d. Prepare a monthly cash budget for January through December using the cash receipts schedule from part b and the cash payments schedule from part c. The beginning cash balance is $5,000, which is also the minimum desired. (Negative amounts should be indicated by a minus sign.)

Solutions

Expert Solution

Answer a.

Answer b.

Answer c.

Answer d.


Related Solutions

Bombs Away Video Games Corporation has forecasted the following monthly sales:    January $ 102,000 July...
Bombs Away Video Games Corporation has forecasted the following monthly sales:    January $ 102,000 July $ 47,000 February 95,000 August 47,000 March 27,000 September 57,000 April 27,000 October 87,000 May 22,000 November 107,000 June 37,000 December 125,000 Total annual sales = $780,000 Bombs Away Video Games sells the popular Strafe and Capture video game. It sells for $5 per unit and costs $2 per unit to produce. A level production policy is followed. Each month's production is equal to...
Bombs Away Video Games Corporation has forecasted the following monthly sales:    January $ 116,000 July...
Bombs Away Video Games Corporation has forecasted the following monthly sales:    January $ 116,000 July $ 61,000 February 109,000 August 61,000 March 41,000 September 71,000 April 41,000 October 101,000 May 36,000 November 121,000 June 51,000 December 139,000 Total annual sales = $948,000 Bombs Away Video Games sells the popular Strafe and Capture video game. It sells for $5 per unit and costs $2 per unit to produce. A level production policy is followed. Each month's production is equal to...
Bombs Away Video Games Corporation has forecasted the following monthly sales:    January $ 112,000 July...
Bombs Away Video Games Corporation has forecasted the following monthly sales:    January $ 112,000 July $ 57,000 February 105,000 August 57,000 March 37,000 September 67,000 April 37,000 October 97,000 May 32,000 November 117,000 June 47,000 December 135,000 Total annual sales = $900,000 Bombs Away Video Games sells the popular Strafe and Capture video game. It sells for $5 per unit and costs $2 per unit to produce. A level production policy is followed. Each month's production is equal to...
Bombs Away Video Games Corporation has forecasted the following monthly sales:    January $ 103,000 July...
Bombs Away Video Games Corporation has forecasted the following monthly sales:    January $ 103,000 July $ 48,000 February 96,000 August 48,000 March 28,000 September 58,000 April 28,000 October 88,000 May 23,000 November 108,000 June 38,000 December 126,000 Total annual sales = $792,000 Bombs Away Video Games sells the popular Strafe and Capture video game. It sells for $5 per unit and costs $2 per unit to produce. A level production policy is followed. Each month's production is equal to...
Bombs Away Video Games Corporation has forecasted the following monthly sales: January $ 89,000 July $...
Bombs Away Video Games Corporation has forecasted the following monthly sales: January $ 89,000 July $ 41,000 February 96,000 August 41,000 March 21,000 September 51,000 April 21,000 October 81,000 May 16,000 November 101,000 June 31,000 December 119,000 Total annual sales = $708,000 Bombs Away Video Games sells the popular Strafe and Capture video game. It sells for $5 per unit and costs $2 per unit to produce. A level production policy is followed. Each month's production is equal to annual...
Bombs Away Video Games Corporation has forecasted the following monthly sales:   January $ 120,000   July $...
Bombs Away Video Games Corporation has forecasted the following monthly sales:   January $ 120,000   July $ 65000   February 113000   August 65000   March 45000   September 75000   April 45000   October 105000   May 40000   November 125000   June 55000   December 143000 Total annual sales = $996,000 Bombs Away Video Games sells the popular Strafe and Capture video game. It sells for $5 per unit and costs $2 per unit to produce. A level production policy is followed. Each month's production is equal to annual...
Bombs Away Video Games Corporation has forecasted the following monthly sales: January $ 111,000 July $...
Bombs Away Video Games Corporation has forecasted the following monthly sales: January $ 111,000 July $ 56,000 February 104,000 August 56,000 March 36,000 September 66,000 April 36,000 October 96,000 May 31,000 November 116,000 June 46,000 December 134,000 Total annual sales = $888,000 Bombs Away Video Games sells the popular Strafe and Capture video game. It sells for $5 per unit and costs $2 per unit to produce. A level production policy is followed. Each month's production is equal to annual...
Bombs Away Video Games Corporation has forecasted the following monthly sales:    January $ 116,000 July...
Bombs Away Video Games Corporation has forecasted the following monthly sales:    January $ 116,000 July $ 61,000 February 109,000 August 61,000 March 41,000 September 71,000 April 41,000 October 101,000 May 36,000 November 121,000 June 51,000 December 139,000 Total annual sales = $948,000 Bombs Away Video Games sells the popular Strafe and Capture video game. It sells for $5 per unit and costs $2 per unit to produce. A level production policy is followed. Each month's production is equal to...
Bombs Away Video Games Corporation has forecasted the following monthly sales:    January $ 118,000 July...
Bombs Away Video Games Corporation has forecasted the following monthly sales:    January $ 118,000 July $ 63,000 February 111,000 August 63,000 March 43,000 September 73,000 April 43,000 October 103,000 May 38,000 November 123,000 June 53,000 December 141,000 Total annual sales = $972,000 Bombs Away Video Games sells the popular Strafe and Capture video game. It sells for $5 per unit and costs $2 per unit to produce. A level production policy is followed. Each month's production is equal to...
Bombs Away Video Games Corporation has forecasted the following monthly sales:    January $ 118,000 July...
Bombs Away Video Games Corporation has forecasted the following monthly sales:    January $ 118,000 July $ 63,000 February 111,000 August 63,000 March 43,000 September 73,000 April 43,000 October 103,000 May 38,000 November 123,000 June 53,000 December 141,000 Total annual sales = $972,000 Bombs Away Video Games sells the popular Strafe and Capture video game. It sells for $5 per unit and costs $2 per unit to produce. A level production policy is followed. Each month's production is equal to...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT