FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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![Required information
[The following information applies to the questions displayed below.]
Iguana, Incorporated, manufactures bamboo picture frames that sell for $25 each. Each frame requires 4 linear feet of
bamboo, which costs $2.00 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 direct materials inventory should be 30 percent of next month's production.
Expected unit sales (frames) for the upcoming months follow:
March
April
May
June
July
August
290
280
330
430
405
455
Variable manufacturing overhead is incurred at a rate of $0.60 per unit produced. Annual fixed manufacturing overhead is
estimated to be $7,200 ($600 per month) for expected production of 3,000 units for the year. Selling and administrative
expenses are estimated at $700 per month plus $0.50 per unit sold.
Iguana, Incorporated, had $11,100 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 direct materials purchases, 80 percent is paid for during the month purchased and 20 percent is paid in the following
month. Direct materials purchases for March 1 totaled $2,000. All other operating costs are paid during the month
incurred. Monthly fixed manufacturing overhead includes $180 in depreciation. During April, Iguana plans to pay $3,300
for a piece of equipment.](https://content.bartleby.com/qna-images/question/1e9c3dfb-2396-480a-9636-f992e16788d7/b97f191e-686f-41d2-a0d7-5f9b5f52bd0a/1epz5t_processed.jpeg)
Transcribed Image Text:Required information
[The following information applies to the questions displayed below.]
Iguana, Incorporated, manufactures bamboo picture frames that sell for $25 each. Each frame requires 4 linear feet of
bamboo, which costs $2.00 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 direct materials inventory should be 30 percent of next month's production.
Expected unit sales (frames) for the upcoming months follow:
March
April
May
June
July
August
290
280
330
430
405
455
Variable manufacturing overhead is incurred at a rate of $0.60 per unit produced. Annual fixed manufacturing overhead is
estimated to be $7,200 ($600 per month) for expected production of 3,000 units for the year. Selling and administrative
expenses are estimated at $700 per month plus $0.50 per unit sold.
Iguana, Incorporated, had $11,100 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 direct materials purchases, 80 percent is paid for during the month purchased and 20 percent is paid in the following
month. Direct materials purchases for March 1 totaled $2,000. All other operating costs are paid during the month
incurred. Monthly fixed manufacturing overhead includes $180 in depreciation. During April, Iguana plans to pay $3,300
for a piece of equipment.
Transcribed Image Text:Required:
1. Compute the budgeted cash receipts for Iguana.
2. Compute the budgeted cash payments for Iguana.
3. Prepare the cash budget for Iguana. Assume the company can borrow in increments of $1,000 to maintain a $10,000 minimum cash
balance. No interest is charged if the loan is paid off by the end of the next quarter.
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Compute the budgeted cash receipts for Iguana.
Note: Do not round your intermediate calculations. Round final answers to 2 decimal places.
June 2nd Quarter Total
Budgeted Cash Receipts
Show Transcribed Text
Required 3
Budgeted Cash Payments
Show Transcribed Text
April
Required:
1. Compute the budgeted cash receipts for Iguana.
2. Compute the budgeted cash payments for Iguana
3. Prepare the cash budget for Iguana. Assume the company can borrow in increments of $1,000 to maintain a $10,000 minimum cash
balance. No interest is charged if the loan is paid off by the end of the next quarter.
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Required 1
Required 2 Required 3
Compute the budgeted cash payments for Iguana.
Note: Do not round your intermediate calculations. Round final answers to 2 decimal places.
May
June
2nd Quarter Total
April
Beginning Cash Balance
Plus: Budgeted Cash Receipts
Less: Budgeted Cash Payments
Preliminary Cash Balance
Cash Borrowed/Repaid
Ending Cash Balance
May
Required t
1
Required:
1. Compute the budgeted cash receipts for Iguana.
2. Compute the budgeted cash payments for Iguana.
Required 3
< Required 1
Required 2 >
3. Prepare the cash budget for Iguana. Assume the company can borrow in increments of $1,000 to maintain a $10,000 minimum cash
balance. No interest is charged if the loan is paid off by the end of the next quarter.
Complete this question by entering your answers in the tabs below.
C
April
Prepare the cash budget for Iguana. Assume the company can borrow in increments of $1,000 to maintain a $10,000
minimum cash balance. No interest is charged if the loan is paid off by the end of the next quarter.
Note: Leave no cell blank enter "0" wherever required. Round your answers to 2 decimal places.
May
< Required 2
Required 3 >
C
June
2nd Quarter Total
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