(1)Budgeted Production (4) Cost of Goods Sold

Sales Volume 112,500 Finished Beg. 468,750

Desired End Inv. 75,000 Direct Materials Beg. 2,850
Total 187,500 Purchases 57,000
Estimated Beg Inv. 62,500 Direct Materials End 3,600
Production 125,000 Materials Used 56,250
Labor 281,250
(2)Materials Purchases Raw Materials Factory Overhead 199,200
Quantities Required 187,500 Manufacturing Cost 536,700
Desired End Inv 12,000 COG Available 1,005,450
Total 199,500 Finished End 562,500
Estimated Beg Inv. 9,500 Cost of Goods Sold 442,950
Total Purchases 190,000
Unit Price 0.30 (5) Budgeted Income Before Tax
Total Direct Materials Purchases 57,000 Sales 843,750
Cost of Goods Sold 442,950
(3)Direct Labor Cost Gross Profit 400,800
Hours Required 62,500 Selling and Admin Exp. 168,750
Hourly Rate 4.50 Income Before Tax 232,050
Total Direct Labor Cost 281,250

(6) Income Statement 2nd Quarter

Revenue 1,000,000
Cost of Goods Sold 600,000
Variable Expenses 100,000
Doubtful Expense 20,000
Selling and Admin Exp 30,000 Fixed 50,000
Fixed Expenses 60,000 Depreciation 10,000
Gross Profit 190,000

(7)Cash Collections January February

40% in December(beg) 20,000
60% in January 60,000
40% in January 40,000
60% in February 120,000
Total 80,000 160,000
Budgeted Sales 100,000 200,000
(8)AR = January Month Sales - Collections 40,000

(9) Cost of Goods Sold 70,000 (10) Budgeted Income Before Tax
Sales 100,000
(11) Payment for Purchases 60,000 Cost of Goods Sold 70,000
(12)Ending Inventory 28,000 Gross Profit 30,000
Selling and Admin Exp. 10,000
Income Before Tax 20,000
(13) Cost of Goods Sold
Income Statement
Sales 2,800,000
Income Before Tax 280,000
Selling and Admin Exp. 700,000
Cost of Goods Sold 1,820,000

(14) Purchases
Cost of Goods Sold 1,820,000
Finished End 336,000
COG Available 2,156,000
Finished Beg 280,000
Cost of Goods Manufactured 1,876,000
WIP End 240,000
COG Placed in Process 2,116,000
Wip Beg 200,000
Total Manufacturing Cost 1,916,000
Conversion Cost 1,341,200
Materials Used 574,800
Direct Materials End 216,000
Direct Materials Beg. 176,000
Purchases 614,800