Operating Budget Create an operating budget for the first quarter ...

  1. Home
  2. Homework Library
  3. Business
  4. Accounting
  5. Operating Budget Create an operating budget for the first quarter ...

QuestionQuestion

Operating Budget
Create an operating budget for the first quarter of a new business.
Projected Sales are:
Month #1: $65,000
Month #2: $97,500
Month #3: $130,000
Month #4: $100,019
These sales are based on selling one product with a selling price of $6.50
Create a Production Budget based on Units (not dollars).
• Desired Finished Goods Ending Inventory each month is 10% of the next month’s projected sales
Create a Direct Materials Purchase Budget
• Each unit produced requires 10# of direct materials at a cost of $0.08 per pound.
• Desired Ending Direct Materials Inventory is 10% of the next month’s material requirements.
Create a Direct Labor Budget
• Direct Labor Costs are $15/hour
• Each unit requires 5 minutes of labor
Create an Overhead Budget
• Variable Overhead Expenses are:
o Supplies ($.02 per unit)
o Inspection ($.10 per unit)
o Maintenance and Repair ($.03 per unit)
o Utilities ($.01 per unit)
• Fixed Overhead Expenses are $1100 monthly.
Create a Selling and Administrative Budget
• Variable Selling & Administrative Expenses are:
o Sales Commissions ($.03 per unit)
o Delivery ($.01 per unit)
o Office Support ($.02 per unit)
• Fixed Selling & Administrative Expenses are $2500 monthly.

Combine all Budgets to Create a Budgeted Income Statement
Complete a Budgeted Income Statement for months 1 through 3, and a Budgeted Income Statement that reflects the total first quarter.

Solution PreviewSolution Preview

These solutions may offer step-by-step problem-solving explanations or good writing examples that include modern styles of formatting and construction of bibliographies out of text citations and references. Students may use these solutions for personal skill-building and practice. Unethical use is strictly forbidden.

    By purchasing this solution you'll be able to access the following files:
    Solution.xlsx.

    $30.00
    for this solution

    or FREE if you
    register a new account!

    PayPal, G Pay, ApplePay, Amazon Pay, and all major credit cards accepted.

    Find A Tutor

    View available Accounting Tutors

    Get College Homework Help.

    Are you sure you don't want to upload any files?

    Fast tutor response requires as much info as possible.

    Decision:
    Upload a file
    Continue without uploading

    SUBMIT YOUR HOMEWORK
    We couldn't find that subject.
    Please select the best match from the list below.

    We'll send you an email right away. If it's not in your inbox, check your spam folder.

    • 1
    • 2
    • 3
    Live Chats