Question

Tyson Inc. has projected sales and production in units for the second quarter of the coming...

Tyson Inc. has projected sales and production in units for the second quarter of the coming year as follows:

April May June
Sales 50,000 40,000 60,000
Production 60,000 50,000 50,000

cash related production costs are budgeted at $5 per unit produced. Of these production costs, 40% are paid in the month in which they are incurred and the balance in the following month. Selling and administrative expenses will amount to $100,000 per month. The accounts payable balance on March 31 totals $190,000, which will be paid in April. All units are sold on account for $14 each. Cash collections from sales are budgeted at 60% in the month of sale, 30% in the month following the month of sale, and the remaining 10% in the second month following the month of sale. Accounts receivable on April 1 totaled $500,000 ($90,000 from Feb. sales and $41,000 from March's sales).

1. prepare a schedule for each month showing budgeted cash disbursements

2. prepare a schedule for each month showing budgeted cash receipts

please show calculations

Homework Answers

Answer #1

1

cash disbursement budget april may june
production cost 300000 250000 250000
cash disbursement
production this month 120000 100000 100000
production prior month 190000 120000 100000
selling and administration 100000 100000 100000
total disbursement 410000 320000 300000

2

cash receipts budgets april may june
total sales 700000 560000 840000
cash receipts
february sales 90000
march sales 410000
april sales 420000 210000 70000
may sales 336000 168000
june sales 504000
total receipts 920000 546000 742000
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