Question

REQUIREMENTS:
1)    Sales Budget
2)    Production Budget
Budgets should be for the individual three (3) months of the first quarter of 2019.
Include a quarterly total column on the right side.
Each budget/requirement should be in a separate tab within one spreadsheet.
All pages should be in portrait format using the same font.
Use proper rounding and show two (2) decimal places of accuracy on dollar amounts.
Round up and show whole amounts on all other figures.
(Hint) Excel provides functions for rounding:
	=ROUND(your formula,2)
	=ROUNDUP(your formula,0)

Bottas Manufacturing, Inc.
Balance Sheet
December 31, 2018
ASSETS
Cash				$               25,711.00
Marketable securities				20,000.00
Accounts receivable				565,844.43
Inventories:
Finished goods		$               86,385.60
Work in process		0.00
Direct materials		7,193.94		93,579.54
Total Current Assets				705,134.97
Property, plant and equipment		$            844,200.00
Less: Accumulated depreciation		(318,600.00)
Total Property, Plant and Equipment				525,600.00
Total Assets				$        1,230,734.97
LIABILITIES AND STOCKHOLDERS EQUITY
Accounts payable		$                  5,755.15
Income taxes payable		0.00
Total Current Liabilities				$                  5,755.15
Long-term notes payable				436,000.00
Total Liabilities				441,755.15
Common stock ($5.00 Par)		$            475,000.00
Paid-in capital		100,000.00
Retained earnings		213,979.82
Total Stockholders Equity				788,979.82
Total Liabilities and Stockholders Equity				$        1,230,734.97
Total Liabilities and Stockholders Equity
FACTS SHEET:

1.  Sales
2018 Actual Units		2019 Budgeted Units
2018 Nov	2018 Dec	2019 Jan	2019 Feb	2019 Mar	2019 Apr	2019 May
7,835	7,970	7,450	7,090	8,320	9,070	10,120
The selling price per unit has remained constant from the past year and is expected to
remain unchanged throughout the first quarter of 2019 at an amount of						$              59.99
2.  Production
The Company's policy is to produce during each month, enough units to meet the current
month's sales as well as a desired inventory at the end of the month which should be
equal to	23%	of next month's estimated sales.  On December 31, 2018, the
finished goods inventory consisted of			1,714	units.
3.  Direct Materials
Each month the Company purchases enough direct materials to meet that month's
production requirements and an amount equal to				25%	of the next month's
estimated production requirements.  Each unit of finished product requires						2.83
pounds of direct materials at a cost of			$1.38	per pound.  On December 31, 2018
the direct materials inventory consisted of				5,213	lbs.
4.  Direct Labour
Direct labour hours required per unit of finished product:					1.75
Average rate per direct labour hour:			$              12.25
5.  Factory Overhead
The Company applies variable factory overhead at the rate of					120%	of direct
labour cost. The Company has the following fixed overhead expenses per month:
	Factory supervisor's salary			$      5,400.00
	Factory rent			6,000.00
	Factory insurance			6,500.00
	Depreciation of factory equipment			600.00
6.  Cost of Goods Sold
Beginning finished goods inventory units were at a cost of					$              50.40
The Company has no beginning or ending work in process inventory.
Beginning direct materials were at a cost of				$                 1.38
7.  Selling and Administrative Expenses
Variable selling and administrative expenses are:
	Freight out		$                 0.80	per unit
	Sales commissions		1%	of sales
Fixed selling and administrative expenses per month are:
	Salaries			$      8,700.00
	Rent			1,800.00
	Advertising			150.00
	Insurance			250.00
	Depreciation (excluding depreciation
	of computer to be purchased at the
	end of January 2019. See Note A)			10,050.00
All selling and administrative costs, except depreciation, are paid for in cash during the
month in which they are incurred.
8.  Income Statement
Interest revenue for the quarter ending March 31, 2019, is					$           300.00
Interest expense for the quarter ending March 31, 2019, see Note B.
Income tax rate is		30%	of income before taxes computed at the end of the
quarter ending March 31, 2019, payable in the second quarter.
9.  Cash Collection Policy
Total sales consist of the following:
Cash sales:	5%
Credit sales:	95%
Credit collections are as follows:
In the month following the month of sale:				75%
In the second month following the month of sale:				25%
The accounts receivable balance of as of December 31, 2018, represents						75%
of credit sales made in December plus			25%	of credit sales made in November to
be collected in January. It also includes			25%	of credit sales made in December to
be collected in February.
The Company does not have bad debts.
10.  Cash Payments Policy
Material purchase payments are made as follows:
In the month of purchase:			80%
In the following month the balance:			20%
The accounts payable balance of			$      5,755.15	as of December 31, 2018
represents	20%	of purchases made in December to be paid in January.
All labour costs are paid for during the month in which they are incurred.
All factory overhead costs, except depreciation, are paid for during the month in
which they are incurred.
Note A.   Capital Expenditure
The Company expects to buy a new computer on January 31, 2019, for use in the sales and
administrative offices at a cost of			$   18,000.00	which will be paid in cash.
Monthly depreciation expense will be an additional				$           300.00
Note B.   Debt Repayment
On March 31, 2019, the Company is scheduled to pay				$   30,000.00	of the long-term notes
payable plus interest expense for the first quarter at a rate of					12%
Note C.   General Information
Each budget/requirement should be in a separate tab/activity sheet within one workbook.
All pages should be in portrait format using the same font.
Use proper rounding and show two (2) decimal places of accuracy on dollar amounts.
Round up and show whole amounts on all other figures.
(Hint) Excel provides functions for rounding:
	=ROUND(your formula,2)
	=ROUNDUP(your formula,0)

PROBLEM #1: Bottas Manufacturing, Inc.
Sales Budget   (sample format)
For the Quarter Ending March 31, 2019
		January	February	March		Quarter
		-				-
Expected unit sales
Unit selling price
		-				-
Total sales
		=				=

PROBLEM #2: Bottas Manufacturing, Inc.
Production Budget   (sample format)
For the Quarter Ending March 31, 2019
		January	February	March		Quarter
		-				-
Expected unit sales
Add: desired ending FG inventory
		-
Total units available
Less: beginning FG inventory
		-				-
Total units to be produced
		=				=

Answer 1