*AE9-3
Crede and Rensing, CPAs, are preparing their service revenue (sales) budget for the coming year (2011). The practice is divided into three departments: auditing, tax, and consulting. Billable hours for each department, by quarter, are provided below. Quarter 1 2,212 3,073 1,503 Quarter 3 1,966 2,078 1,503 Quarter 4 2,404 2,430 1,503
Department Auditing Tax Consulting
Quarter 2 1,629 2,485 1,503
Average hourly billing rates are: auditing $82, tax $90, and consulting $105.
Complete the service revenue (sales) budget for 2011 by listing the departments and showing for each quarter and the year in total, billable hours, billable rate, and total revenue. CREDE AND RENSING, CPA's Sales Revenue Budget
For the Year Ending December 31, 2011 Quarter 1 Billable Billable Hours Rate 2,212 3,073 1,503
Dept Auditing Tax Consulting Totals
Total Rev.
6,788
82 90 105 277
Quarter 2
181,384 276,570 157,815 615,769 1880276
Auditing Tax Consulting Totals
1,629 2,485 1,503
5,617
82 90 105 277
Quarter 3
133,578 223,650 157,815 515,043
Auditing Tax Consulting Totals
1,966 2,078 1,503
5,547
82 90 105 277
Quarter 4
161,212 187,020 157,815 506,047
Auditing Tax
2,404 2,430
82 90
197,128 218,700
Consulting Totals
1,503
6,337
105 277
Totals
157,815 573,643
Auditing Tax Consulting Totals
8,211 10,066 6,012 24,289
82 90 105 277
673,302 905,940 631,260 2,210,502 6,728,053
673302 905940 631260
*AE9-4
Pletcher Company produces and sells automobile batteries, the heavy-duty HD-240. The 2011 sales budget is as follows. Quarter 1 2 3 4 HD-240 5,400 7,290 7,720 10,970
The January 1, 2011, inventory of HD-240 is 2,030 units. Management desires an ending inventory each quarter equal to 40% of the next quarter's sales. Sales in the first quarter of 2012 are expected to be 40% higher than sales in the same quarter in 2011.
Prepare quarterly production budgets for each quarter and in total for 2011. (Enter all amounts as positive amounts and subtract where necessary.) PLETCHER COMPANY Production Budget For the Year Ending December 31, 2011 Product HD-240 Quarter 1 2 3 4
Expected Unit Sales Add: Desired Ending Finished Goods Units Total Required Units Less: Beginning Finished Goods Units Required Production Units
5,400 2,916 8,316 2,030 6,286
7,290 3,088 10,378 2,916 7,462
7,720 4,388 12,108 3,088 9,020
10,970 3,024 13,994 4,388 9,606
budget is as follows.
each quarter equal to 40% les in the same quarter in
s positive amounts and
Year
31,380 13,416 44,796 12,422 32,374
*AE9-5
Dewitt Industries has adopted the following production budget for the first 4 months of 2012. Month January February Units 10,700 7,900
Each unit requires 4 pounds of raw materials costing $4 per pound. On December 31, 2011, the ending raw materials inventory was 14,98 wants to have a raw materials inventory at the end of the month equal to 35% of next month's production requirements.
Complete a direct materials purchases budget by month for the first quarter. (Enter all amounts as positive amounts and subtract w DEWITT INDUSTRIES Direct Materials Purchases Budget For the Quarter Ending March 31, 2012 January February March April
Units to be produced Direct materials per unit Total pounds needed for production Add: Desired ending direct materials (pounds) Total materials required Less: Beginning direct materials (pounds) Direct materials purchases Cost per pound Total cost of direct materials purchases
10,700 7,900 4 4 42,800 31,600 11,060 6,440 53,860 38,040 14,980 11,060 38,880 26,980 $ 4.00 $ 4.00 $ 155,520 107,920
4,600 4 18,400 5,740 24,140 6,440 17,700 4.00 70,800
4100 4 16400
Month March April
Units 4,600 4,100
g raw materials inventory was 14,980 pounds. Management tion requirements.
positive amounts and subtract where necessary.)
*AE9-12
Ortiz Company's sales budget projects unit sales of part 198Z of 10,800 units in January, 12,000 units in February, and 13,400 units in M pound. Ortiz Company desires its ending raw materials inventory to equal 40% of the next month's production requirements, and its endin sales. These goals were met at December 31, 2010.
Prepare a production budget for January and February 2011. (Enter all amounts as positive amounts and subtract where necessar
ORTIZ COMPANY Production Budget For the Two Months Ending February 28, 2011 January February
Expected unit sales Add: Desired ending finished goods units Total required units Less: Beginning finished goods units Required production units
ORTIZ COMPANY Direct Materials Budget For the Month Ending January 31, 2011
10,800 3,600 14,400 3,240 11,160
March 12,000 13400 4,020 16,020 3,600 12,420
Units to be Produced Direct Materials per Unit Total pounds needed for Production Add: Desired ending direct materials (a) Total materials required Less: Beginning Direct Materials Direct materials purchases Cost per pound Total cost of materials purchases
11,160 4 44,640 19,872 64,512 17,856 46,656 4.00 186,624
12,420 4 49,680
n February, and 13,400 units in March. Each unit of part 198Z requires 4 pounds of materials, which cost $4 per uction requirements, and its ending finished goods inventory to equal 30% of the next month's expected unit
s and subtract where necessary.)