Allison Manufacturing

Sales Budget
For quarter 1
January February March Total Quarter 1
Units 40,000 50,000 60,000 150,000
Unit selling price $ 205.00 $ 205.00 $ 205.00 $ 205.00
Budgeted sales $ 8,200,000.00 $ 10,250,000.00 $ 12,300,000.00 $ 30,750,000.00

Allison Manufacturing
Production Budget
For quarter 1

January February March Total Quarter 1

Sales in unit 40,000 50,000 60,000 150,000
Desired ending inventory 40,000 48,000 48,000 136,000
Total needs 80,000 98,000 108,000 286,000
Less: Beginning inventory (32,000) (40,000) (48,000) (120,000)
Units to be produced 48,000 58,000 60,000 166,000

Allison Manufacturing
Direct Material Purchases Budget
For quarter 1

January February March

METAL
Unit to be produced 48,000 58,000 60,000
Direct material per unit 10 10 10
Production needs 480,000 580,000 600,000
Desired ending inventory 290,000 300,000 308,000
Total needs 770,000 880,000 908,000
Less: Beginning inventory (240,000) (290,000) (300,000)
Direct material to be purchased 530,000 590,000 608,000
Cost per unit metal $ 8.00 $ 8.00 $ 8.00
Total purchase cost for metal $ 4,240,000.00 $ 4,720,000.00 $ 4,864,000.00

COMPONENTS
Unit to be produced 48,000 58,000 60,000
Direct material per unit 6 6 6
Production needs 288,000 348,000 360,000
Desired ending inventory 174,000 180,000 184,800
Total needs 462,000 528,000 544,800
Less: Beginning inventory (144,000) (174,000) (180,000)
Direct material to be purchased 318,000 354,000 364,800
Cost per unit component $ 5.00 $ 5.00 $ 5.00
Total purchase cost for component $ 1,590,000.00 $ 1,770,000.00 $ 1,824,000.00

Total direct material purchase cost $ 5,830,000.00 $ 6,490,000.00 $ 6,688,000.00

 Allison Manufacturing
Direct Labor Budget
For quarter 1

January February March

Units to be produced 48,000 58,000 60,000
Direct labor time per unit in hours 3 3 3
Total hours needed 144,000 174,000 180,000
Average wage per hour $ 14.25 $ 14.25 $ 14.25
Total direct labor cost $ 2,052,000.00 $ 2,479,500.00 $ 2,565,000.00

Allison Manufacturing
Overhead Budget
For quarter 1
January February March

Budgeted direct labor hours 144,000 174,000 180,000

Variable overhead rate $ 2.40 $ 2.40 $ 2.40
Budgeted variable overhead $ 345,600.00 $ 417,600.00 $ 432,000.00
Budgeted fixed overhead $ 338,000.00 $ 338,000.00 $ 338,000.00
Total overhead cost $ 683,600.00 $ 755,600.00 $ 770,000.00

Allison Manufacturing
Selling and Administrative Expenses Budget
For quarter 1

January February March

Planned sales in unit 40,000 50,000 60,000

Variable selling & administrative per unit $ 3.60 $ 3.60 $ 3.60
Total variable expenses $ 144,000.00 $ 180,000.00 $ 216,000.00
Fixed selling and administrative expenses:
Salaries $ 50,000.00 $ 50,000.00 $ 50,000.00
Depreciation $ 40,000.00 $ 40,000.00 $ 40,000.00
Other $ 20,000.00 $ 20,000.00 $ 20,000.00
Total fixed expenses $ 110,000.00 $ 110,000.00 $ 110,000.00
Total selling and administrative $ 254,000.00 $ 290,000.00 $ 326,000.00
expenses

Direct material
Metal (10 x $ 8) $ 80.00
Component (6 x $ 5) $ 30.00
Direct labor (3 x $ 14.25) $ 42.75
Overhead
Variable (3 x $ 2.40) $ 7.20
Fixed ($ 1,014,000 : 166,000) $ 6.11
Total unit cost $ 166.06

Allison Manufacturing
Ending Finished Good Inventory Budget
For quarter 1

Desired ending inventory 48,000

Unit cost $ 166.06
Total ending inventory $ 7,970,880.00

Allison Manufacturing
Cost of Good Sold Budget
For quarter 1

Total direct materials cost $ 19,008,000.00

Total direct labor cost $ 7,096,500.00
Total overhead cost $ 2,209,200.00
Total budgeted manufacturing cost $ 28,313,700.00
Beginning finished goods (32,000 x $ 166.06) $ 5,313,920.00
Cost of goods available for sale $ 33,627,620.00
Less: Ending finished goods $ (7,970,880.00)
Budgeted cost of goods sold $ 25,656,740.00

Allison Manufacturing
Budgeted Income Statement
For quarter 1

Sales $ 30,750,000.00
Less: Cost of goods sold $ (25,656,740.00)
Gross margin $ 5,093,260.00
Less: Selling and administrative expenses $ (870,000.00)
Operating income $ 4,223,260.00

Allison Manufacturing
Cash Budget
For quarter 1

January February
Beginning cash balance $ 400,000.00 $ 50,000.00
Cash sales and collections on account $ 8,200,000.00 $ 10,250,000.00
Total cash available $ 8,600,000.00 $ 10,300,000.00
Less disbursements:
Payment for:
Raw material $ (5,830,000.00) $ (6,490,000.00)
Direct labor $ (2,052,000.00) $ (2,479,500.00)
Overhead $ (683,600.00) $ (755,600.00)
Selling and administrative expenses $ (254,000.00) $ (290,000.00)
Total disbursements $ (8,819,600.00) $ (10,015,100.00)
Excess (deficiency) of cash available over needs $ (219,600.00) $ 284,900.00
Financing
Borrowing $ 269,600.00 $ -
Repayment $ - $ -
Interest $ - $ -
Total financing $ 269,600.00 $ -
Ending cash balance $ 50,000.00 $ 284,900.00
 Total Quarter 1

166,000
10
1,660,000
898,000
2,558,000
(830,000)
1,728,000
$ 8.00
$ 13,824,000.00

166,000
6
996,000
538,800
1,534,800
(498,000)
1,036,800
$ 5.00
$ 5,184,000.00

$ 19,008,000.00
 Total Quarter 1
166,000
3
498,000
$ 14.25
$ 7,096,500.00

Total Quarter 1

498,000
$ 2.40
$ 1,195,200.00
$ 1,014,000.00
$ 2,209,200.00

Total Quarter 1

150,000
$ 3.60
$ 540,000.00

$ 150,000.00
$ 120,000.00
$ 60,000.00
$ 330,000.00
$ 870,000.00
 March
$ 284,900.00
$ 12,300,000.00
$ 12,584,900.00

$ (6,688,000.00)
$ (2,565,000.00)
$ (770,000.00)
$ (326,000.00)
$ (10,349,000.00)
$ 2,235,900.00

$ -
$ (269,600.00)
$ (5,392.00)
$ (274,992.00)
$ 1,960,908.00