Personal Budget
At the beginning of the school year, Katherine Malloy decided to prepare a cash budget for the months of September, October, November, and December. The budget must plan for enough cash on December 31 to pay the spring semester tuition, which is the same as the fall tuition. The following information relates to the budget:
| Cash balance, September 1 (from a summer job) | $6,480 |
| Purchase season football tickets in September | 90 |
| Additional entertainment for each month | 220 |
| Pay fall semester tuition in September | 3,500 |
| Pay rent at the beginning of each month | 310 |
| Pay for food each month | 180 |
| Pay apartment deposit on September 2 (to be returned December 15) | 400 |
| Part-time job earnings each month (net of taxes) | 800 |
a. Prepare a cash budget for September, October, November, and December. Enter all amounts as positive values except an overall cash decrease which should be indicated with a minus sign.
| KATHERINE MALLOY | ||||
| Cash Budget | ||||
| For the Four Months Ending December 31 | ||||
| September | October | November | December | |
| Estimated cash receipts from: | ||||
| Part-time job | $ | $ | $ | $ |
| Deposit | ||||
| Total cash receipts | $ | $ | $ | $ |
| Estimated cash payments for: | ||||
| Season football tickets | $ | |||
| Additional entertainment | $ | $ | $ | |
| Tuition | ||||
| Rent | ||||
| Food | ||||
| Deposit | ||||
| Total cash payments | $ | $ | $ | $ |
| Overall cash increase (decrease) | $ | $ | $ | $ |
| Cash balance at beginning of month | ||||
| Cash balance at end of month | $ | $ | $ | $ |
b. Are the four monthly budgets that are
presented prepared as static budgets or flexible budgets?
c. Malloy can see that her present plan sufficient cash. If Malloy did not budget but went ahead with the original plan, she would be $ at the end of December, with no time left to adjust.
In: Accounting
3. Phoenix Company’s 2019 master budget included the following fixed budget report. It is based on an expected production and sales volume of 17,000 units.
| PHOENIX COMPANY Fixed Budget Report For Year Ended December 31, 2019 |
|||||
| Sales | $ | 4,250,000 | |||
| Cost of goods sold | |||||
| Direct materials | $ | 850,000 | |||
| Direct labor | 170,000 | ||||
| Machinery repairs (variable cost) | 51,000 | ||||
| Depreciation—Plant equipment (straight-line) | 315,000 | ||||
| Utilities ($34,000 is variable) | 194,000 | ||||
| Plant management salaries | 215,000 | 1,795,000 | |||
| Gross profit | 2,455,000 | ||||
| Selling expenses | |||||
| Packaging | 68,000 | ||||
| Shipping | 102,000 | ||||
| Sales salary (fixed annual amount) | 270,000 | 440,000 | |||
| General and administrative expenses | |||||
| Advertising expense | 127,000 | ||||
| Salaries | 251,000 | ||||
| Entertainment expense | 100,000 | 478,000 | |||
| Income from operations | $ | 1,537,000 | |||
Phoenix Company’s actual income statement for 2019 follows.
| PHOENIX COMPANY Statement of Income from Operations For Year Ended December 31, 2019 |
|||||
| Sales (20,000 units) | $ | 5,078,000 | |||
| Cost of goods sold | |||||
| Direct materials | $ | 1,016,000 | |||
| Direct labor | 208,000 | ||||
| Machinery repairs (variable cost) | 51,000 | ||||
| Depreciation—Plant equipment (straight-line) | 315,000 | ||||
| Utilities (fixed cost is $157,500) | 197,000 | ||||
| Plant management salaries | 224,000 | 2,011,000 | |||
| Gross profit | 3,067,000 | ||||
| Selling expenses | |||||
| Packaging | 77,500 | ||||
| Shipping | 112,000 | ||||
| Sales salary (annual) | 287,000 | 476,500 | |||
| General and administrative expenses | |||||
| Advertising expense | 135,000 | ||||
| Salaries | 251,000 | ||||
| Entertainment expense | 104,000 | 490,000 | |||
| Income from operations | $ | 2,100,500 | |||
Required:
1. Prepare a flexible budget performance report
for 2019. (Indicate the effect of each variance by
selecting for favorable, unfavorable, and No
variance.)
In: Accounting
Personal Budget
At the beginning of the 2016 school year, Britney Logan decided to prepare a cash budget for the months of September, October, November, and December. The budget must plan for enough cash on December 31 to pay the spring semester tuition, which is the same as the fall tuition. The following information relates to the budget:
| Cash balance, September 1 (from a summer job) | $9,020 |
| Purchase season football tickets in September | 120 |
| Additional entertainment for each month | 310 |
| Pay fall semester tuition in September | 4,900 |
| Pay rent at the beginning of each month | 440 |
| Pay for food each month | 250 |
| Pay apartment deposit on September 2 (to be returned December 15) | 600 |
| Part-time job earnings each month (net of taxes) | 1,120 |
a. Prepare a cash budget for September, October, November, and December. Enter all amounts as positive values except an overall cash decrease which should be indicated with a minus sign.
| Britney Logan | ||||
| Cash Budget | ||||
| For the Four Months Ending December 31, 2016 | ||||
| September | October | November | December | |
| Estimated cash receipts from: | ||||
| Part-time job | $ | $ | $ | $ |
| Deposit | ||||
| Total cash receipts | $ | $ | $ | $ |
| Estimated cash payments for: | ||||
| Season football tickets | $ | |||
| Additional entertainment | $ | $ | $ | |
| Tuition | ||||
| Rent | ||||
| Food | ||||
| Deposit | ||||
| Total cash payments | $ | $ | $ | $ |
| Cash increase (decrease) | $ | $ | $ | $ |
| Cash balance at beginning of month | ||||
| Cash balance at end of month | $ | $ | $ | $ |
b. Are the four monthly budgets that are
presented prepared as static budgets or flexible budgets?
c. Brittany can see that her present plan sufficient cash. If Logan did not budget but went ahead with the original plan, she would be $ at the end of December, with no time left to adjust.
In: Accounting
At the beginning of the school year, Katherine Malloy decided to prepare a cash budget for the months of September, October, November, and December. The budget must plan for enough cash on December 31 to pay the spring semester tuition, which is the same as the fall tuition. The following information relates to the budget:
| Cash balance, September 1 (from a summer job) | $7,550 |
| Purchase season football tickets in September | 100 |
| Additional entertainment for each month | 260 |
| Pay fall semester tuition in September | 4,100 |
| Pay rent at the beginning of each month | 370 |
| Pay for food each month | 210 |
| Pay apartment deposit on September 2 (to be returned December 15) | 500 |
| Part-time job earnings each month (net of taxes) | 940 |
a. Prepare a cash budget for September, October, November, and December. Enter all amounts as positive values except an overall cash decrease which should be indicated with a minus sign.
| KATHERINE MALLOY | ||||
| Cash Budget | ||||
| For the Four Months Ending December 31 | ||||
| September | October | November | December | |
| Estimated cash receipts from: | ||||
| Part-time job | $ | $ | $ | $ |
| Deposit | ||||
| Total cash receipts | $ | $ | $ | $ |
| Estimated cash payments for: | ||||
| Season football tickets | $ | |||
| Additional entertainment | $ | $ | $ | |
| Tuition | ||||
| Rent | ||||
| Food | ||||
| Deposit | ||||
| Total cash payments | $ | $ | $ | $ |
| Overall cash increase (decrease) | $ | $ | $ | $ |
| Cash balance at beginning of month | ||||
| Cash balance at end of month | $ | $ | $ | $ |
b. Are the four monthly budgets that are
presented prepared as static budgets or flexible budgets?
(static, flexible)
c. Malloy can see that her present plan (will, will not provide) sufficient cash. If Malloy did not budget but went ahead with the original plan, she would be $ ? (over/short) at the end of December, with no time left to adjust.
In: Accounting
Problem 23-2A Preparation and analysis of a flexible budget performance report LO P1, P2, A1
Phoenix Company’s 2017 master budget included the following
fixed budget report. It is based on an expected production and
sales volume of 16,000 units.
|
PHOENIX COMPANY Fixed Budget Report For Year Ended December 31, 2017 |
|||||
| Sales | $ | 3,200,000 | |||
| Cost of goods sold | |||||
| Direct materials | $ | 960,000 | |||
| Direct labor | 240,000 | ||||
| Machinery repairs (variable cost) | 48,000 | ||||
| Depreciation—Plant equipment (straight-line) | 315,000 | ||||
| Utilities ($32,000 is variable) | 182,000 | ||||
| Plant management salaries | 215,000 | 1,960,000 | |||
| Gross profit | 1,240,000 | ||||
| Selling expenses | |||||
| Packaging | 64,000 | ||||
| Shipping | 96,000 | ||||
| Sales salary (fixed annual amount) | 260,000 | 420,000 | |||
| General and administrative expenses | |||||
| Advertising expense | 127,000 | ||||
| Salaries | 241,000 | ||||
| Entertainment expense | 110,000 | 478,000 | |||
| Income from operations | $ | 342,000 | |||
Phoenix Company’s actual income statement for 2017
follows.
|
PHOENIX COMPANY Statement of Income from Operations For Year Ended December 31, 2017 |
|||||
| Sales (19,000 units) | $ | 3,848,000 | |||
| Cost of goods sold | |||||
| Direct materials | $ | 1,157,000 | |||
| Direct labor | 294,000 | ||||
| Machinery repairs (variable cost) | 48,000 | ||||
| Depreciation—Plant equipment (straight-line) | 315,000 | ||||
| Utilities (fixed cost is $148,000) | 185,250 | ||||
| Plant management salaries | 225,000 | 2,224,250 | |||
| Gross profit | 1,623,750 | ||||
| Selling expenses | |||||
| Packaging | 73,250 | ||||
| Shipping | 107,000 | ||||
| Sales salary (annual) | 277,000 | 457,250 | |||
| General and administrative expenses | |||||
| Advertising expense | 135,000 | ||||
| Salaries | 241,000 | ||||
| Entertainment expense | 113,000 | 489,000 | |||
| Income from operations | $ | 677,500 | |||
Required:
1. Prepare a flexible budget performance report
for 2017.
In: Accounting
At the beginning of the 2016 school year, Britney Logan decided to prepare a cash budget for the months of September, October, November, and December. The budget must plan for enough cash on December 31 to pay the spring semester tuition, which is the same as the fall tuition. The following information relates to the budget:
| Cash balance, September 1 (from a summer job) | $8,080 |
| Purchase season football tickets in September | 110 |
| Additional entertainment for each month | 280 |
| Pay fall semester tuition in September | 4,400 |
| Pay rent at the beginning of each month | 390 |
| Pay for food each month | 220 |
| Pay apartment deposit on September 2 (to be returned December 15) | 600 |
| Part-time job earnings each month (net of taxes) | 1,000 |
a. Prepare a cash budget for September, October, November, and December. Enter all amounts as positive values except an overall cash decrease which should be indicated with a minus sign.
| Britney Logan | ||||
| Cash Budget | ||||
| For the Four Months Ending December 31, 2016 | ||||
| September | October | November | December | |
| Estimated cash receipts from: | ||||
| Part-time job | $ | $ | $ | $ |
| Deposit | ||||
| Total cash receipts | $ | $ | $ | $ |
| Estimated cash payments for: | ||||
| Season football tickets | $ | |||
| Additional entertainment | $ | $ | $ | |
| Tuition | ||||
| Rent | ||||
| Food | ||||
| Deposit | ||||
| Total cash payments | $ | $ | $ | $ |
| Cash increase (decrease) | $ | $ | $ | $ |
| Cash balance at beginning of month | ||||
| Cash balance at end of month | $ | $ | $ | $ |
b. Are the four monthly budgets that are
presented prepared as static budgets or flexible budgets?
c. Brittany can see that her present plan sufficient cash. If Logan did not budget but went ahead with the original plan, she would be $ at the end of December, with no time left to adjust.
In: Accounting
Answer completely and correctly please.
At the beginning of the school year, Craig Kovar decided to prepare a cash budget for the months of September, October, November, and December. The budget must plan for enough cash on December 31 to pay the spring semester tuition, which is the same as the fall tuition. The following information relates to the budget:
| Cash balance, September 1 (from a summer job) | $9,250 |
| Purchase season football tickets in September | 160 |
| Additional entertainment for each month | 250 |
| Pay fall semester tuition in September | 4,800 |
| Pay rent at the beginning of each month | 600 |
| Pay for food each month | 550 |
| Pay apartment deposit on September 2 (to be returned December 15) | 600 |
| Part-time job earnings each month (net of taxes) | 1,200 |
a. Prepare a cash budget for September, October, November, and December. Enter all amounts as positive values except cash decrease which should be indicated with a minus sign.
| Craig Kovar | ||||||||||||||||||
| Cash Budget | ||||||||||||||||||
| For the Four Months Ending December 31 | ||||||||||||||||||
| September | October | November | December | |||||||||||||||
| Estimated cash receipts from: | ||||||||||||||||||
| Part-time job | $ | $ | $ | $ | ||||||||||||||
| Deposit | ||||||||||||||||||
| Total cash receipts | $ | $ | $ | $ | ||||||||||||||
| Less estimated cash payments for: | ||||||||||||||||||
| Season football tickets | $ | |||||||||||||||||
| Additional entertainment | $ | $ | $ | |||||||||||||||
| Tuition | ||||||||||||||||||
| Rent | ||||||||||||||||||
| Food | ||||||||||||||||||
| Deposit | ||||||||||||||||||
| Total cash payments | $ | $ | $ | $ | ||||||||||||||
| Cash increase (decrease) | $ | $ | $ | $ | ||||||||||||||
| Plus cash balance at beginning of month | ||||||||||||||||||
| Cash balance at end of month | $ | $ | $ | $ | ||||||||||||||
b. What are the budget implications for Craig Kovar?
Craig can see that his present plan will not provide sufficient cash. If Craig did not budget but went ahead with the original plan, he would be $_?_ short at the end of December, with no time left to adjust.
In: Accounting
Phoenix Company’s 2019 master budget included the following
fixed budget report. It is based on an expected production and
sales volume of 15,000 units.
| PHOENIX COMPANY Fixed Budget Report For Year Ended December 31, 2019 |
|||||
| Sales | $ | 3,375,000 | |||
| Cost of goods sold | |||||
| Direct materials | $ | 825,000 | |||
| Direct labor | 225,000 | ||||
| Machinery repairs (variable cost) | 60,000 | ||||
| Depreciation—Plant equipment (straight-line) | 330,000 | ||||
| Utilities ($45,000 is variable) | 205,000 | ||||
| Plant management salaries | 200,000 | 1,845,000 | |||
| Gross profit | 1,530,000 | ||||
| Selling expenses | |||||
| Packaging | 75,000 | ||||
| Shipping | 105,000 | ||||
| Sales salary (fixed annual amount) | 270,000 | 450,000 | |||
| General and administrative expenses | |||||
| Advertising expense | 129,000 | ||||
| Salaries | 261,000 | ||||
| Entertainment expense | 100,000 | 490,000 | |||
| Income from operations | $ | 590,000 | |||
Phoenix Company’s actual income statement for 2019
follows.
| PHOENIX COMPANY Statement of Income from Operations For Year Ended December 31, 2019 |
|||||
| Sales (18,000 units) | $ | 4,128,000 | |||
| Cost of goods sold | |||||
| Direct materials | $ | 1,006,000 | |||
| Direct labor | 278,000 | ||||
| Machinery repairs (variable cost) | 64,000 | ||||
| Depreciation—Plant equipment (straight-line) | 330,000 | ||||
| Utilities (fixed cost is $157,500) | 211,000 | ||||
| Plant management salaries | 210,000 | 2,099,000 | |||
| Gross profit | 2,029,000 | ||||
| Selling expenses | |||||
| Packaging | 87,250 | ||||
| Shipping | 118,000 | ||||
| Sales salary (annual) | 287,000 | 492,250 | |||
| General and administrative expenses | |||||
| Advertising expense | 136,000 | ||||
| Salaries | 261,000 | ||||
| Entertainment expense | 103,000 | 500,000 | |||
| Income from operations | $ | 1,036,750 | |||
Required:
1. Prepare a flexible budget performance report
for 2019. (Indicate the effect of each variance by
selecting for favorable, unfavorable, and No
variance.)
In: Accounting
Personal Budget At the beginning of the school year, Katherine Malloy decided to prepare a cash budget for the months of September, October, November, and December. The budget must plan for enough cash on December 31 to pay the spring semester tuition, which is the same as the fall tuition. The following information relates to the budget: Cash balance, September 1 (from a summer job) $7,990 Purchase season football tickets in September 110 Additional entertainment for each month 280 Pay fall semester tuition in September 4,300 Pay rent at the beginning of each month 390 Pay for food each month 220 Pay apartment deposit on September 2 (to be returned December 15) 600 Part-time job earnings each month (net of taxes) 990 a. Prepare a cash budget for September, October, November, and December. Enter all amounts as positive values except an overall cash decrease which should be indicated with a minus sign.
| KATHERINE MALLOY | ||||
| Cash Budget | ||||
| For the Four Months Ending December 31 | ||||
| September | October | November | December | |
| Estimated cash receipts from: | ||||
| Part-time job | $ | $ | $ | $ |
| Deposit | ||||
| Total cash receipts | $ | $ | $ | $ |
| Estimated cash payments for: | ||||
| Season football tickets | $ | |||
| Additional entertainment | $ | $ | $ | |
| Tuition | ||||
| Rent | ||||
| Food | ||||
| Deposit | ||||
| Total cash payments | $ | $ | $ | $ |
| Overall cash increase (decrease) | $ | $ | $ | $ |
| Cash balance at beginning of month | ||||
| Cash balance at end of month | $ | $ | $ | $ |
b. Are the four monthly budgets that are
presented prepared as static budgets or flexible budgets?
c. Malloy can see that her present plan ------------ sufficient cash. If Malloy did not budget but went ahead with the original plan, she would be $---------- ----------- at the end of December, with no time left to adjust.
In: Accounting
| Little Leaguers | Summer Sluggers | Elite Ballplayers (Print Ad) | Elite Ballplayers (Party) | Entertainment Seekers | |
| Contact Cost | ¥1,000 | ¥1,500 | ¥300 | ¥12,500 | ¥50 |
| Response Rate | 10.0% | 15.0% | 0.5% | 25.0% | 2.5% |
| Acquisition Cost | 10,000 | 10,000 | 60,000 | 50,000 | 2,000 |
| Workers Needed | 2 | 1 | 1 | 1 | 2 |
| Worker Labor Cost | ¥1,500 | ¥1,500 | ¥1,500 | ¥1,500 | ¥1,500 |
| Instructors Needed | 1 | 0 | 1 | 1 | 0 |
| Instructor Hourly Labor Cost | ¥3,000 | N/A | ¥4,500 | ¥4,500 | N/A |
| Total Cost Per Hour | 6,000 | 1,500 | 6,000 | 6,000 | 3,000 |
| Hourly Price Charged | ¥6,500 | ¥3,000 | ¥7,500 | ¥7,500 | ¥4,000 |
| Hourly Margin ¥ | 500 | 1,500 | 1,500 | 1,500 | 1,000 |
| Hourly Margin % | 8% | 100% | 25% | 25% | 33% |
| Annual Hours | 10.0 | 4.0 | 20.0 | 20.0 | 1.5 |
| Annual Margin ¥ | 5,000 | 6,000 | 30,000 | 30,000 | 1,500 |
| Retention Rate | 75.0% | 50.0% | 60.0% | 60.0% | 35.0% |
| Interest Rate | 10.0% |
taking into account the time value of money and assuming that 100 percent of a customer will have experienced attrition once the net present value of annual profits per customer falls below Y100, what is the lifetime value to MBC of the following customers? Assume that a customer's lifetime extends up to and including the year in which the net present value of annual profits falls below Y100.
a. little leaguer
b. summer slugger
c. elite ballplayer (print ad)
d. elite ballplayer (party) i. should MBC throw the gala event?
e. entertainment seeker
In: Operations Management