Question

Iguana, Inc., manufactures bamboo picture frames that sell for $30 each. Each frame requires 4 linear feet of bamboo, which costs $3.00 per foot. Each frame takes approximately 30 minutes to build, and the labor rate averages $11 per hour. Iguana has the following inventory policies: Ending finished goods inventory should be 40 percent of next month’s sales. Ending raw materials inventory should be 30 percent of next month’s production. Expected unit sales (frames) for the upcoming months follow: March 300 April 300 May 350 June 450 July 425 August 475 Variable manufacturing overhead is incurred at a rate of $0.30 per unit produced. Annual fixed manufacturing overhead is estimated to be $9,600 ($800 per month) for expected production of 4,000 units for the year. Selling and administrative expenses are estimated at $850 per month plus $0.60 per unit sold. Iguana, Inc., had $12,800 cash on hand on April 1. Of its sales, 80 percent is in cash. Of the credit sales, 50 percent is collected during the month of the sale, and 50 percent is collected during the month following the sale. Of raw materials purchases, 80 percent is paid for during the month purchased and 20 percent is paid in the following month. Raw materials purchases for March 1 totaled $3,500. All other operating costs are paid during the month incurred. Monthly fixed manufacturing overhead includes $200 in depreciation. During April, Iguana plans to pay $3,500 for a piece of equipment. 4.value: 8.50 pointsRequired information You did not receive full credit for this question in a previous attempt Required: Compute the following for Iguana, Inc., for the second quarter (April, May, and June). eBook & Resources eBook: Prepare the following components of the operating budget: Cost of goods sold budget. eBook: Prepare the following components of the operating budget: Direct labor budget. eBook: Prepare the following components of the operating budget: Manufacturing overhead budget. eBook: Prepare the following components of the operating budget: Production budget. eBook: Prepare the following components of the operating budget: Raw materials purchases budget. eBook: Prepare the following components of the operating budget: Sales budget. eBook: Prepare the following components of the operating budget: Selling and administrative expense budget. Previous attempt 5.value: 8.50 pointsRequired information You did not receive full credit for this question in a previous attempt Required: Complete Iguana's budgeted income statement for quarter 2. (Round cost per unit in intermediate calculations and final answers to 2 decimal places.) eBook & Resources eBook: Prepare the following components of the operating budget: Budgeted income statement. Previous attempt 6.value: 8.50 pointsRequired information You did not receive full credit for this question in a previous attempt Required: 1. Compute the budgeted cash receipts for Iguana. (Do not round your intermediate calculations. Round final answers to 2 decimal places.) 2. Compute the budgeted cash payments for Iguana. (Do not round your intermediate calculations. Round final answers to 2 decimal places.) 3. Prepare the cash budget for Iguana. Assume the company can borrow in increments of $1,000 to maintain a $12,000 minimum cash balance. (Leave no cell blank enter "0" wherever required. Round your answers to 2 decimal places.)

Answer 1