Reference no: EM132794038

Shown below is the sales forecast for Tulip's industry.

For the first four Quarter of the coming year. Quarter 1 sales (in units) are 40 000 increases in sequent by the multiple of 20 000 for the rest of quarters except for the last quarter sales are 50 000 units.

• Tulip's single product sells for 8$.
• Sales collected in the following pattern, 75% in the quarter of sales, and the remaining 25% in the following quarter. The financial statement position (FSP) showed $65 000 balance of account receivables. All of which will be collected in the first quarter.
• The company desires an ending finished goods inventory at the end each quarter equal to 30% of the budget sales unit sales for the next quarter. It had 12 000 units in hand on December, 31. Beginning balance of finished goods is 10 000 units
• Five pounds of raw materials are required to complete one unit of product. Tulip Company require ending raw materials inventory at the end of each quarter equal to 10% of following quarter's production needs. On December, 31 the raw materials on hand are 23 000 Pounds. Beginnings balance of raw materials is 18000 Pounds.
• The raw materials cost $0.08 per pound. Raw materials purchased are paid in the following pattern: 60% paid in the quarter of purchases are made the remaining 40% paid in the following quarter. On January the company FSP showed $81 500 in account payable for raw materials purchase.

Required:

Problem 1: Prepare the following budgets and schedule for the year, showing quarterly and total figures:

a. A sales budget and a schedule of expected cash collection.

b. A production Budget.

c. A direct materials budget and a schedule of expected cash payments for purchases Martials.

d. A direct labor budget if direct labor's rate and cost are 0.40 and 18$ sequentially.

e. A MOH budget taking in consideration the Variable MOH rate is $4 and fixed MOH are $60 000, the only none-cash items is depreciation, which is $15 000 per quarter.

f. An ending finished goods inventory Budget.