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Company Name: Klandon Company


Beginning Balance Sheet Date (MM/DD/YYYY): March 31, 2015

Klandon Company
Balance Sheet
as of March 31, 2015
Cash $ 40,000
Accounts Receivable (net) 30,000
Finished Goods Inventory 26,000
Raw Materials Inventory 5,200
Property, Plant & Equipment 200,000
Accumulated Depreciation (50,000)
Total Assets $ 251,200

Accounts Payable $ 12,000


Income Tax Payable 50,000
Common Stock 52,000
Retained Earnings 137,200
Total Liabilities & Owners Equity $ 251,200

Budgeted Sales (in units)

March (actual) April May June July August


Units 12,000 20,000 50,000 30,000 25,000 15,000
Price per unit $10.00 $10.00 $10.00 $10.00 $10.00 $10.00

Cash Collection Pattern

Cash % 0%
Month of sale 70%
Month after sale 25%
Uncollectible 5%
Inventory

Beginning finished goods (units) 4,000


Desired ending finished goods (%) 20% of the following period's budgeted sales.

Raw material metric (pound, ounce, etc.) pound


Raw materials per finished unit 5 pounds
Raw materials on hand (units) 3/31/15 13,000 pounds
Desired ending raw materials (%) 10% of the following period's production needs.

Material price per pound $0.40

Cash Payment Pattern

Month of purchase 50%


Month after purchase 50%

Direct Labor

Standard quantity 0.25 DLH per unit


Standard labor rate $10.00 per DLH

Planned Equipment Purchases

April May June


Manufacturing equipment $ - $ - $ -
Office equipment $ - $ - $ 48,000
Useful life (years) 5 year life
Overhead

Variable
Fixed Overhead Overhead per
per month unit
Depreciation 8,000
Indirect Materials 1,000 $ 0.05
Indirect Labor 10,000 $ 0.20
Utilities 20,000 $ 0.10
Property Taxes 5,000 $ -
Maintenance 6,000 $ 0.15

Budgeted Annual Fixed Overhead $ 600,000


Application Base (DLH, MH, etc.) DLH
Total Budgeted Application Base Volume 100,000
Application Base quantity per finished unit 0.25 DLH
Predetermined fixed overhead rate $6.00 per DLH

Selling & Administrative Expenses

Commission per Unit


April May June
Sales Commission (%) 5% $ 0.50 $ 0.50 $ 0.50

Budgeted Changes in Fixed S&A Expenses


Fixed S&A per Variable S&A per
month unit April May June
Depreciation $ 10,000 800
Salesperson Compensation 25,000 $ 0.50 - - -
Advertising 1,000 - - - -
Management Salaries 10,000 - - - -
Miscellaneous 500 - - - -
Additional Scheduled Payments

April May June


Dividends $ 49,000 $ - $ -
Income Taxes $ 50,000 $ - $ -

Financing Parameters

Minimum Cash Balance $ 30,000


Line of Credit amount $ 175,000
Borrowing increment $ 1,000
Payment increment $ 1,000
Annual Interest rate 12.00%
Tax Rate 30%
Sales Budget 0

April May June Quarter


Budgeted units sold 20,000 50,000 30,000 100,000
x budgeted sales price $ 10.00 $ 10.00 $ 10.00 $ 10.00
Budgeted sales revenue $ 200,000 $ 500,000 $ 300,000 $ 1,000,000
Selling and Administrative Expense Budget 0

April May June Quarter


Depreciation $ 10,000 $ 10,000 $ 10,800 $ 30,800
Salaries of sales personnel 35,000 50,000 40,000 $ 125,000
Advertising 1,000 1,000 1,000 $ 3,000
Management salaries 10,000 10,000 10,000 $ 30,000
Miscellaneous 500 500 500 $ 1,500
Bad debts 10,000 25,000 15,000 $ 50,000
Total budgeted expense 66,500 96,500 77,300 240,300
Less non-cash items
Depreciation 10,000 10,000 10,800 30,800
Bad debts 10,000 25,000 15,000 50,000
Total cash costs $ 46,500 $ 61,500 $ 51,500 $ 159,500
Production Budget 0

April May June Quarter July


Budgeted unit sales 20,000 50,000 30,000 100,000 25,000
Budgeted ending inventory 10,000 6,000 5,000 5,000 3,000
Total units required 30,000 56,000 35,000 105,000 28,000
Less: beginning inventory 4,000 10,000 6,000 4,000 5,000
Budgeted production 26,000 46,000 29,000 101,000 23,000
Material Purchased Budget 0

April May June Quarter July


Budgeted production 26,000 46,000 29,000 101,000 23,000
standard materials per unit 5 5 5 5 5
Total production needs 130,000 230,000 145,000 505,000 115,000
Budgeted ending inventory 23,000 14,500 11,500 49,000
Total materials required 153,000 244,500 156,500 554,000 115,000
Less: Beginning Inventory 13,000 23,000 14,500 50,500
Budgeted materials purchases 140,000 221,500 142,000 503,500 115,000
standard price per pound $ 0.40 $ 0.40 $ 0.40 $ 0.40 $
Budgeted purchases cost $ 56,000 $ 88,600 $ 56,800 $ 201,400 $
Direct Labor Budget 0

April May June Quarter


Budgeted production 26,000 46,000 29,000 101,000
Standard direct labor hours per unit 0.25 0.25 0.25 0.25
Total direct labor hours required 6,500 11,500 7,250 25,250
Standard average wage rate $ 10.00 $ 10.00 $ 10.00 $ 10.00
Budgeted direct labor cost $ 65,000 $ 115,000 $ 72,500 $ 252,500
Manufacturing Overhead Budget 0

April May June Quarter


Variable overhead cost $ 13,000 $ 23,000 $ 14,500 $ 50,500
Fixed overhead cost 50,000 50,000 50,000 150,000
Total budgeted manufacturing overhead 63,000 73,000 64,500 200,500
Less: non-cash items
Depreciation $ 8,000 $ 8,000 $ 8,000 24,000
Total cash costs $ 55,000 $ 65,000 $ 56,500 $ 176,500
Ending Inventory and Cost of Goods Sold Budget 0

Raw Materials

Beginning raw materials inventory $ 5,200


Purchases of direct materials 201,400
Less: direct materials used 202,000
Ending raw materials inventory $ 4,600

Finished Goods

Unit cost
Direct materials $ 2.00
Direct labor $ 2.50
Overhead $ 1.99
Total standard unit cost $ 6.49
Ending inventory units 5,000
Ending finished goods inventory $ 32,426

Cost of Goods Sold


Beginning work in process $
Direct materials used 202,000
Direct labor 252,500
Manufacturing overhead $ 200,500
Total manufacturing costs 655,000
Less: Ending work in process -
Cost of goods manufactured 655,000
Add: Beginning finished goods 26,000
Less: Ending finished goods $ 32,426
Cost of goods sold 648,574
Cash Receipts Budget 0

Total Cash Accounts


April May June Receipts Bad Debts Receivable
Beginning Accounts Receivable 30,000 30,000
Cash Sales 140,000 350,000 210,000 700,000
April Sales 50,000 125,000 175,000 10,000
May Sales 25,000
June Sales 15,000 75,000
Totals $ 170,000 $ 400,000 $ 335,000 $ 905,000 $ 50,000 $ 75,000
Cash Payments for Materials Purchased Budget 0

Total Cash Accounts


April May June Disbursements Payable
March (actual) Accounts Payable 12,000 12,000
April Purchases 28,000 28,000 56,000
May Purchases 44,300 44,300 88,600
June Purchases 28,400 28,400 28,400
Totals $ 40,000 $ 72,300 $ 72,700 $ 185,000 $ 28,400
Cash Budget Charles Davis: 0
This would be C32. Ending balance from last
month would be this month's beginning
balance. It's not necessarily the minimum.

April May June Quarter


Beginning cash balance $ 40,000 $ 30,500 $ 30,440 $ 40,000
Collections from sales 170,000 400,000 335,000 905,000
Total Cash Available to Spend 210,000 430,500 365,440 945,000

Less disbursements:
Material purchases 40,000 72,300 72,700 185,000
Direct labor 65,000 115,000 72,500 252,500
Manufacturing overhead 55,000 65,000 56,500 176,500
Selling & administrative expenses 46,500 61,500 51,500 159,500
Income taxes 50,000 - - 50,000
Equipment (sales) purchases - - 48,000 48,000
Dividends Charles Davis: 49,000 - - 49,000
Total Cash Disbursements
you have to 305,500 313,800 301,200 920,500
borrow in even Charles Davis:
increments of repayment have to be
Cash excess (deficiency) (95,500) 116,700 64,240 24,500
$1,000, so you in increments of
Minimum Cash Balance 30,000 30,000 30,000 30,000 $1,000, so you have to
need 126,000.
Cash excess (needed) (125,500) 86,700 34,240 (5,500) go with $84,000

Short-Term Financing:
Borrowing 126,000 - - 126,000
Repayments 85,000 33,000 118,000 Charles Davis:
Interest 1,260 410 1,670 Sum across the row for
these three rows.
Total Short-Term Financing 126,000 86,260 33,410 245,670

Ending Cash Balance $ 30,500 $ 30,440 $ 30,830 $ 30,830


Klandon Company
Pro-forma Income Statement

Quarter End
Sales $ 1,000,000
Cost of goods sold 648,574
Gross profit 351,426
Selling & administrative expense 240,300
Operating income 111,126
Interest expense 1,670
Income before taxes 109,456
Income tax expense 32,837 $ (2,387)
Net income $ 76,619 $ (5,362)
$ (35)

Klandon Company
Pro-forma Balance Sheet

Quarter End
Cash $ 30,830
Accounts receivable 75,000
Finished goods inventory 32,426
Raw materials inventory 4,600
Property, plant & equipment 248,000
Accumulated depreciation (104,800)
Total Assets $ 286,056

Accounts payable $ 28,400


Interest payable $ -
Income tax payable 32,837
Short-term note payable 8,000
Total Liabilities 69,237

Common stock 52,000


Retained earnings 164,819
Total Liabilities & Equity $ 286,056