Question

The management of Zigby Manufacturing prepared the following estimated balance sheet for March 2017: ZIGBY MANUFACTURING Estimated Balance Sheet March 31, 2017 Assets Cash $ 54,000 Accounts receivable 354,375 Raw materials inventory 100,495 Finished goods inventory 333,000 Total current assets 841,870 Equipment, gross 628,000 Accumulated depreciation (164,000 ) Equipment, net 464,000 Total assets $ 1,305,870 Liabilities and Equity Accounts payable $ 212,195 Short-term notes payable 26,000 Total current liabilities 238,195 Long-term note payable 514,000 Total liabilities 752,195 Common stock 349,000 Retained earnings 204,675 Total stockholders’ equity 553,675 Total liabilities and equity $ 1,305,870 To prepare a master budget for April, May, and June of 2017, management gathers the following information: Sales for March total 22,500 units. Forecasted sales in units are as follows: April, 22,500; May, 19,500; June, 21,700; and July, 22,500. Sales of 254,000 units are forecasted for the entire year. The product’s selling price is $22.50 per unit and its total product cost is $18.50 per unit. Company policy calls for a given month’s ending raw materials inventory to equal 50% of the next month’s materials requirements. The March 31 raw materials inventory is 5,025 units, which complies with the policy. The expected June 30 ending raw materials inventory is 5,400 units. Raw materials cost $20 per unit. Each finished unit requires 0.50 units of raw materials. Company policy calls for a given month’s ending finished goods inventory to equal 80% of the next month’s expected unit sales. The March 31 finished goods inventory is 18,000 units, which complies with the policy. Each finished unit requires 0.50 hours of direct labor at a rate of $10 per hour. Overhead is allocated based on direct labor hours. The predetermined variable overhead rate is $4.10 per direct labor hour. Depreciation of $30,790 per month is treated as fixed factory overhead. Sales representatives’ commissions are 6% of sales and are paid in the month of the sales. The sales manager’s monthly salary is $4,400. Monthly general and administrative expenses include $26,000 administrative salaries and 0.5% monthly interest on the long-term note payable. The company expects 30% of sales to be for cash and the remaining 70% on credit. Receivables are collected in full in the month following the sale (none are collected in the month of the sale). All raw materials purchases are on credit, and no payables arise from any other transactions. One month’s raw materials purchases are fully paid in the next month. The minimum ending cash balance for all months is $54,000. If necessary, the company borrows enough cash using a short-term note to reach the minimum. Short-term notes require an interest payment of 1% at each month-end (before any repayment). If the ending cash balance exceeds the minimum, the excess will be applied to repaying the short-term notes payable balance. Dividends of $24,000 are to be declared and paid in May. No cash payments for income taxes are to be made during the second calendar quarter. Income tax will be assessed at 40% in the quarter and paid in the third calendar quarter. Equipment purchases of $144,000 are budgeted for the last day of June. Required: Prepare the following budgets and other financial information as required. All budgets and other financial information should be prepared for the second calendar quarter, except as otherwise noted below. (Round calculations up to the nearest whole dollar, except for the amount of cash sales, which should be rounded down to the nearest whole dollar.): 1. Sales budget. 2. Production budget. 3. Raw materials budget. 4. Direct labor budget. 5. Factory overhead budget. 6. Selling expense budget. 7. General and administrative expense budget. 8. Cash budget. 9. Budgeted income statement for the entire second quarter (not for each month separately). 10. Budgeted balance sheet.

CAN YOU PLEASE ANSWER THE ENITRE QUESTION. GOD BLESS AND STAY SAFE.

Answer 1

Solution 1:
ZIGBY MANUFACTURING
Sales Budget
April, May, and June 2017
	Budgeted Unit Sales	Budgeted Unit Price	Budgeted Sales Dollars
Apr-19	22500	$22.50	$506,250.00
May-19	19500	$22.50	$438,750.00
Jun-19	21700	$22.50	$488,250.00
Totals for the second quarter	63700	$22.50	$1,433,250.00
Solution 2:
ZIGBY MANUFACTURING
Production Budget
April, May, and June 2017
	April	May	June
Next month's budgeted sales (units)	19500	21700	22500
Ratio of inventory to future sales	80%	80%	80%
Desired ending inventory	15600	17360	18000
Budgeted sales units	22500	19500	21700
Required units of available production	38100	36860	39700
Beginning inventory	18000	15600	17360
Units to be produced	20100	21260	22340
Solution 3:
ZIGBY MANUFACTURING
Raw Materials Budget
April, May, and June 2017
	April	May	June
Production budget (units)	20100	21260	22340
Raw material per unit	0.5	0.5	0.5
Materials needed for production	10050	10630	11170
Desired ending inventory	5315	5585	5400
Total materials requirements (units)	15365	16215	16570
Beginning inventory	5025	5315	5585
Materials to be purchased	10340	10900	10985
Material price per unit	$20.00	$20.00	$20.00
Budgeted raw material purchases	$206,800.00	$218,000.00	$219,700.00
Solution 4:
ZIGBY MANUFACTURING
Direct Labor Budget
April, May, and June 2017
	April	May	June	Total
Budgeted production (units)	20100	21260	22340	63700
Direct labor hour per unit	0.5	0.5	0.5	0.5
Total labor hours needed	10050	10630	11170	31850
Direct labor rate per hour	$10.00	$10.00	$10.00	$10.00
Budgeted direct labor cost	$100,500.00	$106,300.00	$111,700.00	$318,500.00
Solution 5:
ZIGBY MANUFACTURING
Factory overhead Budget
April, May, and June 2017
	April	May	June	Total
Labor hours needed	10050	10630	11170	31850
Variable overhead rate per hour	$4.10	$4.10	$4.10	$4.10
Budgeted variable overhead	$41,205.00	$43,583.00	$45,797.00	$130,585.00
Budgeted fixed overhead	$30,790.00	$30,790.00	$30,790.00	$92,370.00
Budgeted total overhead	$71,995.00	$74,373.00	$76,587.00	$222,955.00