Dowson Company is creating components of its master budget for the year. Below is some information from the budget committee.
Current Year QuartersNext Year Quarters123412Budgeted unit sales40,300 63,050 102,490 56,940 72,200 81,400
Selling price per unit $37.62
Accounts receivable, beginning balance $108,106
Sales collected in the quarter sales are made 57%
Sales collected in the quarter after sales are made 43%
Desired ending finished goods inventory is 30% of the budgeted unit sales of the next quarter
Finished goods inventory, beginning 13,010 units
Raw materials required to produce one unit 23 pounds
Desired ending inventory of raw materials is 10% of the next quarter's production needs
Raw materials inventory, beginning 25,158 pounds
Raw material costs $0.96 per pound
Raw materials purchases are paid 78% in the quarter the purchases are made and 22% in the quarter following purchase
All other expenses are paid the quarter they are incurred
Accounts payable for raw materials, beginning balance $90,500
Direct Labor Hours per unit 0.93
Direct Labor Rate per Hour $22.68
Variable Overhead per Unit 2.28
Fixed Overhead per quarter $30,000
Variable Selling Expense per unit sold $2.15
Fixed Selling expense per quarter $29,000
Required:
Construct the sales budget for the current year.
Construct the schedule of expected cash collections.
Construct the production budget.
Construct the raw materials purchases budget.
Construct the direct labor budget.
Construct the manufacturing overhead budget.
Construct the selling and administrative budget.
Construct the schedule of expected cash payments.