Problem 13-66 (Algo) Comprehensive Budget Plan (LO 13-3, 4, 5)Lane Products manufactures a popular kitchen utensil. The company recently expanded, and the controller believes that it will need to borrow cash to continue operations. It opened negotiations with the local bank for a one-month loan of $76,000 starting March 1. The bank would charge interest at the rate of 0.5 percent per month and require the company to repay interest and principal on March 31. In considering the loan, the bank requested a projected income statement and cash budget for March.The following information is available:The company budgeted sales at 30,000 units per month in February, April, and May and at 27,000 units in March. The selling price is $78 per unit.The company offers a 2 percent discount for cash sales. The company's experience is that bad debts average 1 percent of credit sales.The inventory of finished goods on February 1 was 4,200 units. The desired finished goods inventory at the end of each month equals 25 percent of sales anticipated for the following month. There is no work in process.The inventory of raw materials on February 1 was 3,180 pounds. At the end of each month, the raw materials inventory equals no less than 20 percent of production requirements for the following month. The company purchases materials in quantities of 340 pounds per shipment.Selling expenses are 6 percent of gross sales. Administrative expenses, which include depreciation of $1,650 per month on office furniture and fixtures, total $79,200 per month.The manufacturing budget for the utensil, based on normal production of 29,000 units per month, follows.Materials (½ pound per utensil, 14,500 pounds, $30 per pound) $ 435,000Labor 138,000Variable overhead 78,000Fixed overhead (includes depreciation of $56,000) 138,000Total $ 789,000Required:a-1. Prepare schedules computing inventory budgets by months for production in units for February, March, and April.a-2. Prepare schedules computing inventory budgets by months for raw materials purchases in pounds for February and March.b. Prepare a projected income statement for March. Cost of goods sold should equal the variable manufacturing cost per unit times the number of units sold plus the total fixed manufacturing cost budgeted for the period. Assume that 40 percent of sales are cash sales.

Problem 13-56 (Algo) Prepare Budgeted Financial Statements (LO 13-5)Coyle Manufacturing reports the following information for year 1:Sales revenue (77,000 units) $ 5,385,000Manufacturing costs  Materials $ 319,000Variable cash costs 256,000Fixed cash costs 607,000Depreciation (fixed) 1,817,000Marketing and administrative costs  Marketing (variable, cash) 930,000Marketing depreciation 286,000Administrative (fixed, cash) 933,000Administrative depreciation 151,000Total costs $ 5,299,000Operating profits (losses) $ 86,000All depreciation charges are fixed. Manufacturing depreciation is expected to increase by 10 percent in year 2. Marketing and administrative depreciation are expected to remain the same for year 2. Sales volume is expected to increase by 5 percent, but prices are expected to fall by 10 percent. Materials costs per unit are expected to decrease by 8 percent. Unit variable cash manufacturing costs are expected to increase by 15 percent. Fixed cash costs are expected to increase by 6 percent.Variable marketing costs will change with unit volume. Administrative cash costs are expected to decrease by 10 percent. Inventories are kept at zero. Coyle Manufacturing operates on a cash basis.Required:Prepare a budgeted income statement for year 2 for Coyle Manufacturing.Note: Do not round intermediate calculations. Round your final answers to the nearest whole dollar amounts.

Exercise 20-17 (Algo) Preparation of cash budgets (for three periods) LO P2Kayak Company budgeted the following cash receipts (excluding cash receipts from loans received) and cash payments (excluding cash payments for loan principal and interest payments) for the first three months of next year.   Cash Receipts Cash paymentsJanuary $ 516,000 $ 461,700February 403,000 348,700March 468,000 530,000 Kayak requires a minimum cash balance of $40,000 at each month-end. Loans taken to meet this requirement charge 1%, interest per month, paid at each month-end. The interest is computed based on the beginning balance of the loan for the month. Any preliminary cash balance above $40,000 is used to repay loans at month-end. The company has a cash balance of  $40,000 and a loan balance of $80,000 at January 1. Prepare monthly cash budgets for January, February, and March. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign.)

Exercise 13-39 (Algo) Estimate Cash Collections (LO 13-4)Hackett Produce Supply is preparing its cash budget for April. The following information is available:Estimated credit sales for April $ 268,000Actual credit sales for March $ 159,000Estimated collections in April for credit sales prior to March $ 15,000Estimated write-offs in April for uncollectible credit sales $ 11,420Estimated provision for bad debts in April for credit sales in April $ 10,430Estimated collections in April for credit sales in April 25%Estimated collections in April for credit sales in March 70%Required:What is the estimated amount of cash receipts from accounts receivable collections in April?

A company borrows money as needed on the first day of the month and repays principal and interest on the last day of the budget period, if cash is available.  For the second quarter of the year, they borrowed $10,000 in April, $8,000 in May and $5,000 in June.  The interest rate is 1% per month.  Assuming enough money is available on June 30th to repay the debt, the total amount of interest due is Blank______.Multiple choice question.$560$230$690

Draw up a cash budget for A. Aiman showing the balance at the end of each month, fromthe following information for the six months ended 30 December 2023:a) Opening cash (including bank) balance on 1 July 2023 $3,600b) Production Units:2024 2025March April May June July Aug Sep Oct Nov Dec Jan720 810 900 960 1,050 1,110 1,140 1,020 930 780 750c) Raw materials used in production cost $15 per unit. Of this, 90 per cent in the month ofproduction and 10 per cent in the month after production.d) Direct labour costs of $24 per unit are payable in the month of production.e) Variable expenses are $6 per unit, payable 40 per cent in the same month as production and60 per cent in the month following production.f) Sales at $60 per unit:2024 2025Feb Mar Apr May June July Aug Sep Oct Nov780 600 960 870 1,200 900 1,050 1,200 1,170 1,200Debtors to pay their accounts three months after that in which sales are made.g) Fixed expenses of $1,200 per month payable each month.h) Machinery costing $6,000 to be paid for in September 2024.i) Will receive a legacy of $7,000 in November 2024.j) Drawings will be $900 per month.