Description

ACTG 3020

MANAGERIAL ACCOUNTING

MASTER BUDGET PROJECT

Phase II: 100 Points (Note: You may do the Connect alternative by yourself for the same points)

Note: Obtain a copy of the Excel file from my D2L site from the Projects folder. I have provided headings for most budgets and schedules necessary for Phase II in the attached file.

            You must prepare individual budgets and schedules (ALL included in Chapter 8 of the text) to complete your master budget. Your assumptions page will look similar to the one in the book (also found in the word doc I posted of budgets for CH8). I have also included this on a “sample assumptions” tab for your convenience. Be sure to include company and group members’ names. The budget will be for 2018 in quarterly detail and in total. To simplify the assignment, assume your company will start operation on January 1, 2020. This means you will have NO (0) beginning inventory, A/P, A/R. So your budgets will look a little different than the one we did in class for practice.

            Begin each budget or schedule on the left hand side of your spreadsheet. This will assist me in grading your projects. Remember in your budgets, link to the assumptions page and from one budget to the other in as many places as possible.

            Remember that I want a budget for each quarter and a total for the year. You may have to use the first two quarters of the next year (assume the sales # on assumptions tab) to figure out some ending inventory values.

1)      Sales Budget

Determine your budgeted sales per quarter in units and the sales price per unit (through 2nd quarter 2021, so 6 quarters total). All the rest of the budgets will flow from this budget. Make sure all budgets are linked in your spreadsheet.

2)      Schedule of Cash Collections

The schedule of cash collections should depend on your credit policies. You must assume a cash collection pattern for credit sales. Put this in your assumptions tab. Link to sales budget.

3)      Production Budget

Develop your production budget (through 1st quarter 2021) based on established finished goods inventory policy as a percentage of the next quarter’s sales.

4)      Direct Materials Budget

You must develop a direct materials budget for each of your raw materials. (Calculate production needs through 1st quarter 2021) You must use a stated raw materials inventory policy based on next quarter’s raw materials needs. Include a cost per unit for your raw materials. (I have included -0- beginning 1st quarter inventories because you are starting business on that date.)

5)      Schedule of Cash Disbursements

The schedule of cash disbursements should reference the total dollar amount of purchases of both raw materials. (Just complete one schedule of cash disbursements.) You must assume a cash payment pattern for credit purchases. Link to production budget.

6)      Direct Labor Budget

7)      Manufacturing Overhead Budget

            Prepare a manufacturing overhead budget. Use direct labor hours as a base to apply overhead. Direct labor hours will be the simplest and easiest base to use because you already have prepared a direct labor budget. Notice that you will have a variable cost per input unit (direct labor hour or machine hour) for each variable manufacturing overhead item and total variable manufacturing overhead per input unit. Note that the indirect labor cost is per direct labor hour or machine hour, not per indirect labor hour. Just link to the total variable cost per input unit amount for your variable manufacturing overhead rate at the bottom of the budget. You will also have quarterly fixed overhead amounts by item and total fixed overhead per quarter. Include a predetermined fixed overhead rate calculation at the bottom of the budget.

8)      Selling and Administrative Expenses Budget

Prepare the selling and administrative expenses budget in detail.

Grading: Each budget is 11 points (88 total), 5 points for assumptions tab and 7 points for formatting/readability. Your grade may also be adjusted based on feedback from your team members on your participation, etc. This is at my discretion.

            For Phase II, there is a dropbox on D2L for the Excel file that includes all of the linked budgets and schedules as well as a detailed Assumptions tab. I need ONE file per group in the dropbox BY 11:59pm on the due date on your class schedule.