Budgeting

Question 1

Budgeted Production

Answer 1

Budgeted Sales
+ Desired ending inventory
-Beg. inventory
=Budgeted production

Question 2

Units of DM to be purchased

Answer 2

units of DM needed
+desired end. inventory at the end
-beg. inventory at the start
= units of DM to be purchased

Question 3

cost of DM to be purchased

Answer 3

units of DM to be purchased x cost/unit

Question 4

DM Usage (Cost of materials used)

Answer 4

Beg. inventory at cost
+ purchases at cost
- end. inventory at cost
=DM usage

Question 5

total wages

Answer 5

budgeted production (in units)
x hrs. required to produce each unit
= total # of hours needed
x total wage rate
= total wages

Question 6

COGS

Answer 6

COGM
+ beg. FG
- end. FG
= COGS

Question 7

cash budget format

Answer 7

beg cash
+ cash collections from sales
- cash disbursements for purchases and op. expenses
= computed end. cash
- cash req. to sustain operations
= working capital loans to maintain cash requirements