Slide 1
Planning & Controlling :Budgeting1Setting Organizational
ObjectivesEvaluating Accomplishmentsof
OrganizationalObjectivesIdentifying Opportunitiesand/or
ProblemsSelecting Course ofAction and AllocatingResourcesPlanning
and Control FrameworkPurposes of Budgeting Systems Budgeta detailed
plan, expressed in quantitative terms, that specifies how resources
will be acquired and used during a specified period of
time.PlanningFacilitating Communication and CoordinationAllocating
ResourcesControlling Profit and OperationsEvaluating Performance
and Providing Incentives3
Compels managersto think aheadAids managers in coordinating
their effortsProviding information of resource for the decision
making (corectional decision)Advantages of Budgets
Provides definite expectations that are the best framework to
evaluate performanceTypes of BudgetsStrategic PlanLong-Range
PlanCapital BudgetMaster BudgetContinuous Budget 5
Strategic PlanThe most forward-looking budget is the strategic
plan, which sets the overall goals and objectives of the
organization.6Long-Range PlanThe strategic plan leads to long-range
planning, which produces forecasted financial statements for five-
to ten-year periods.Types of Budgets1999200020012002Continuous or
Rolling BudgetThis budget is usually a twelve-month budget that
rolls forward one month as the current month is completed.L o n g R
a n g e B u d g e t sCapital budgets with acquisitions that
normally cover several years.8Capital BudgetLong-range plans are
coordinated with capital budgets,which detail the planned
expendituresfor facilities, equipment, new products,and other
long-term investments.Master Budget (anggaran induk)Rencana
keuangan yang komprehensif utk keseluruhan organisasi yang terdiri
atas berbagai anggaran
individual.SalesProductionDistributionFinanceOperating
BudgetFinancial BudgetMain Components of Master Budget.Preparation
of a Master Budget for a Retail OrganizationCapital Expenditures
BudgetPurchases BudgetSales BudgetCash BudgetBudgeted Income
StatementCost of GoodsSold
BudgetOperatingBudgetsFinancialBudgetsSelling
andAdministrativeExpense BudgetBudgetedBalance Sheet12Preparation
of a Master Budget for a Service OrganizationService
RevenueOperatingBudgetsFinancialBudgetsSelling
andAdministrativeExpense BudgetBudgetedBalanceSheetLabor
BudgetServicesOverheadBudgetBudgetedIncome StatementCash
BudgetCapital Expenditures Budget13PurchasesBudget____ ________
________ ________ ________ ____Cost ofGoods SoldBudget____ ________
________ ________ ____OperatingExpensesBudget____ ________ ________
________ ____BudgetedIncomeStatement____ ________ ________ ________
____SalesBudget____ ________ ________ ________ ________
____InventoryBudget____ ________ ________ ________ ________
____Operating BudgetComponents of Master Budgetdescribe of
activities to yield earnings (sale, produce, finished goods), so
that end result from operating budget loss/profit proforma
BudgetedBalanceSheet_____ __________ __________ __________
__________ _____CapitalBudget_____ __________ __________ __________
__________ _____CashBudget
_____ __________ __________ __________ __________
_____Components of Master BudgetFinancialBudgetitemizing cash flows
(in cash budget) and also the financial position in general posed
balance sheet proformaActivity-Based Costing versus Activity-Based
BudgetingResourcesCost objects:products and servicesproduced,
andcustomers served.ActivitiesResourcesForecast of productsand
services to beproduced andcustomers
served.ActivitiesActivity-BasedCosting (ABC)Activity-BasedBudgeting
(ABB)Budgeting and the Management Cycle
Relate the organizations long-term goals to its short-term
activitiesDistribute resources and workloadsCommunicate
responsibilitiesSelect performance measuresSet goals for bonuses
and rewards Communicate expectations Challenge & motivate
others Coordinate activities Recognize problems Communicate budget
information Provide continuous feedback Calculate variances
Evaluate performance Determine timeliness Create solutions for
continuous improvement17Lets produce the Master Budgetfor Breakers,
Inc.
DetailBudget
DetailBudgetDetailBudget
MasterBudgetCovering allphases ofa
companysoperations.SalesProductionMaterials18Sales BudgetBreakers,
Inc. is preparing budgets for the quarter ending June 30.Budgeted
sales for the next five months are:April 20,000 unitsMay 50,000
unitsJune 30,000 unitsJuly 25,000 unitsAugust 15,000 units.The
selling price is $10 per unit.
19Sales Budget
Production Budget20Production Budget
Sales Budget
ProductionBudgetCompletedProduction must be adequate to meet
budgetedsales and provide for sufficient ending inventory.
21Production BudgetThe management of Breakers, Inc. wants ending
inventory to be equal to 20% of the following months budgeted sales
in units.
On March 31st, 4,000 units were on hand.
Lets prepare the production budget.
Production Budget22
Production Budget
24
Production Budget
26
Production Budget
27Direct-Material BudgetAt Breakers, five pounds of material are
required per unit of product.Management wants materials on hand at
the end of each month equal to 10% of the following months
production.On March 31, 13,000 pounds of material are on hand.
Material cost $0.40 per pound.
Lets prepare the direct materials budget.
28
Direct-Material BudgetFrom ourproductionbudget
29
10% of the following months productionDirect-Material Budget
30
March 31 inventoryDirect-Material Budget
31
Direct-Material Budget
32
Direct-Material Budget
33Direct-Labor BudgetAt Breakers, each unit of product requires
0.1 hours of direct labor.The Company has a no layoff policy so all
employees will be paid for 40 hours of work each week.In exchange
for the no layoff policy, workers agreed to a wage rate of $8 per
hour regardless of the hours worked (No overtime pay).For the next
three months, the direct labor workforce will be paid for a minimum
of 3,000 hours per month.Lets prepare the direct labor budget.
34
From ourproductionbudgetDirect-Labor Budget
35Direct-Labor Budget
36
This is the greater oflabor hours required orlabor hours
guaranteed.Direct-Labor Budget
37
Direct-Labor Budget
Total DLH Q238Overhead BudgetHere is Breakers Overhead Budget
for the quarter.
Total MOH Q239Selling and Administrative Expense BudgetAt
Breakers, variable selling and administrative expenses are $0.50
per unit sold.Fixed selling and administrative expenses are $70,000
per month.The $70,000 fixed expenses include $10,000 in
depreciation expense that does not require a cash outflows for the
month.40
Selling and Administrative Expense BudgetFrom ourSales
budget41Selling and Administrative Expense Budget
42Selling and Administrative Expense Budget
43At Breakers, all sales are on account.The companys collection
pattern is:70% collected in the month of sale,25% collected in the
month following sale,5% is uncollected.The March 31 accounts
receivable balance of $30,000 will be collected in full.Cash
Receipts Budget
44Cash Receipts Budget
45
Cash Receipts Budget
Back to Cash Dishbursment.46Cash Disbursement BudgetBreakers
pays $0.40 per pound for its materials.One-half of a months
purchases are paid for in the month of purchase; the other half is
paid in the following month.No discounts are available.The March 31
accounts payable balance is $12,000.
47
140,000 lbs. $.40/lb. = $56,000Cash Disbursement Budget
48
Cash Disbursement Budget
49Cash Disbursement BudgetContinuedBreakers:Maintains a 12% open
line of credit for $75,000.Maintains a minimum cash balance of
$30,000.Borrows and repays loans on the last day of the month.Pays
a cash dividend of $25,000 in April.Purchases $143,700 of equipment
in May and $48,300 in June paid in cash.Has an April 1 cash balance
of $40,000.50
From our CashDisbursementsBudgetCash Disbursement
BudgetContinued52
From our DirectLabor BudgetCash Disbursement
BudgetContinued53
From ourOverhead BudgetCash Disbursement BudgetContinued54
From ourSelling and AdministrativeExpense BudgetCash
Disbursement BudgetContinued55
To maintain a cashbalance of $30,000,Breakers must borrow$35,000
on its line of credit.Cash Disbursement BudgetContinued56
Ending cash balance for Aprilis the beginning May balance.Cash
Disbursement BudgetFinancing and Repayment57
Cash Disbursement BudgetContinuedBreakers mustborrow anaddition
$13,800to maintain acash balanceof $30,000.58Cash Disbursement
BudgetFinancing and Repayment
59
At the end of June, Breakers has enough cash to repaythe $48,800
loan plus interest at 12%.Cash Disbursement BudgetContinued60Cash
Disbursement BudgetFinancing and Repayment
61
Cash Disbursement BudgetContinued62Cash Disbursement
BudgetFinancing and Repayment
63Budgeted Income Statement
Cash Budget
BudgetedIncomeStatementCompletedAfter we complete the cash
budget, we can preparethe budgeted income statement for
Breakers.64Budgeted Ending Inventory
Total overhead $191,000 Total labor hours 10,600 hrs.= $18.02
per hr.* *roundedManufacturing overhead is applied on the basis of
direct labor hours.65Budgeted Income Statement
66Budgeted Balance SheetBreakers reports the following account
balances on June 30 prior to preparing its budgeted financial
statements:Land - $50,000Building (net) - $148,000Common stock -
$200,000Retained earnings - $46,40067
25% of Junesales of $300,00011,500 lbs. at$.40 per lb.5,000
units at$4.60 per unit.68
50% of Junepurchases of $56,800
69Budget AdministrationThe Budget Committee is a standing
committee responsible for . . .overall policy matters relating to
the budget.coordinating the preparation of the budget.
70E-Budgeting (Penganggaran Elektronik)Employees throughout an
organizationcan submit and retrieve budget information
electronically. This tends to streamline the entire budgeting
process.
71Firewalls and Information SecurityBudget information is
extremely sensitive and confidential. A firewall is a computer or
router placed between a companys internal network and the internet
to control all information between the outside world and the
companys local network.
72Sistem Penganggaran Untuk Operasi-Operasi BisnisPenganggaran
Inkremental (Incremental Budgeting)Penganggaran Basis Nol
(Zero-Based Budgeting)Penganggaran Statik (Static
Budgeting)Penganggaran Fleksibel (Flexible Budgeting)Penganggaran
Inkremental (Incremental/Baseline Budgeting)Adalah metode
penganggaran yang hanya mempertimbangkan perubahan sumber-sumber
daya dari anggaran tahun sebelumnya. Anggaran tahun sebelumnya
dijadikan sebagai dasar penyusunan anggaran.Banyak digunakan oleh
organisasi pemerintahan dan nirlaba.Zero-Base Budgeting(Anggaran
Basis Nol)Di dalam penyusunan anggaran, semua jajaran manajemen
bertolak dari nol dan menaksir kebutuhan-kebutuhan sumber daya yang
diperlukan untuk mendanai aktivitas-aktivitas tahun anggaran
berikutnya. Anggaran tahun sebelumnya tidak diterima apa
adanya.
75Penganggaran Statik (Static Budgeting)Merupakan anggaran yang
dipakai oleh banyak perusahaan jasa dan pada banyak fungsi
pendukung seperti bagian pembelian, akuntansi, hukum.Anggaran
statik disusun untuk suatu tingkat aktivitas tertentu.Penganggaran
Fleksibel (Flexible Budgeting)Mengaitkan volume aktivitas dengan
jumlah uang yang dianggarkan.Merupakan serangkaian anggaran untuk
berbagai macam tingkat aktivitas.Anggaran fleksibel dapat membantu
manajemen menghadapi ketidakpastian dengan memungkinkan mereka
untuk melihat taksiran hasil-hasil dan kisaran aktivitas
tertentu.Formulasi Anggaran FleksibelAnggaran fleksibel adalah
anggaran yang dapat dibuat untuk aktivitas dengan berbagai
tingkatan. Untuk pelaporan kinerja, adalah penting untuk
membandingkan biaya aktual untuk tingkat aktivitas aktual dengan
biaya yang dianggarkan untuk tingkat aktivitas aktual. Anggaran
fleksibel memberikan cara untuk menghitung biaya yang dianggarkan
untuk tingkat aktivitas aktual. Anggaran fleksibel mensyaratkan
pengetahuan akan komponen biaya variabel dan biaya tetap, yang
didasarkan pada rumus sederhana : Y = F + VX. International Aspects
of BudgetingFirms with international operations face special
problems when preparing a budget.Fluctuations in foreign currency
exchange rates.High inflation rates in some foreign
countries.Differences in local economic conditions.
79Budgeting Product Life-Cycle CostsProduct planningand
conceptDesign.Preliminarydesign.Detailed designand
testing.Production.Distributionand customerservice.
80Participative BudgetingFlow of Budget Data
Penganggaran partisipatif adalah suatu sistem anggaran yang
memberikan kesempatan bagi para manajer bawahan utk ikut menyusun
anggaran. Anggaran parisipatif memberikan rasa tanggung jawab kpd
para manajer yang lebih rendah dan mendorong timbulnya kreatifitas
dan meningkatkan tingginya tingkat keselarasan tujuan.81Potensi
masalah yang muncul dalam penyusunan anggaranPenetapan Standar yang
terlalu tinggi atau terlalu rendah personal goal.Memasukkan slack
dalam anggaran (padding the budget) tindakan mengamankan
anggaran.Partisipasi semu/formalisasi partisipasi anggaran
pseudoparticipation.Behavioral Impact of BudgetsBudgetary Slack :
Padding the BudgetPeople often perceive that their performance will
look better in their superiors eyes if they can beat the
budget.
83
Hmm....chaf dhhh!!Kalau ada yang mo tanya.yo ndhang
tanyao!Hmmmhhh...!!84
So Go'odMartCheeseIce CreamIts delicious ice creamYeahits good.
How they manage this mart?Just Do It..!Stamphose
Operating Budget for a Merchandising CompanySo Good Cheese
Company is a wholesale distributor of blue cheese and ice cream.
The following information is available for April 2014.
Estimated sales :Blue cheese 160,000 hoops at $10 eachIce
cream240,000 gallons at $5 each
Desired inventories :BeginningEndingBlue cheese 10,000 12,000Ice
cream 4,000 5,000
Estimated costs :Blue cheese $8 per hoopIce cream$2 per
gallon
Financial information :Beginning cash balance is $400,000.
Purchases of merchandise are paid 60% in current month and 40%
in following month. Purchases totaled $1,800,000 in March.
Employee wages, salaries, and commisions are paid for in current
month. Employee expenses for April totaled $156,000.
Overhead expenses are paid in the next month. The account
payable for these expenses from March is $80,000.
Sales on credit are collected 70% in current period and 29% in
the next period. March sales were $3,000,000. Bad debts average one
percent of sales.
Selling and administrative expenses are paid monthly and total
$540,000, including $40,000 of depreciation.
Please, prepare the following for April 2014 :Sales budget in
dollarsPurchases budgetCash budgetPro forma income statementsLets
do it...!
Anda Pasti Bisa..!!!SalesAprilMayJuneQuarterBudgeted sales
(units)20,00050,00030,000100,000Selling price per
unit$10$10$10$10Total Revenue$200,000$500,000$300,000$1,000,000
&APage &P
ProductionAprilMayJuneJulySales in
units20,00050,00030,00025,000Add: desired ending
inventory10,0006,0005,0003,000Total
needed30,00056,00035,00028,000Less: begin-ning
inventory4,00010,0006,0005,000Production in
units26,00046,00029,00023,000May sales (sales budget)50,000Percent
of inventory desired20%Desired ending inventory10,000
&APage &P
MaterialsAprilMayJuneQuarterProduction in
units26,00046,00029,000101,000Materials per unit5555Production
needs130,000230,000145,000505,000Add: desired ending
inventory23,00014,50011,50011,500Total
needed153,000244,500156,500516,500Less: beginning
inventory13,00023,00014,50013,000Materials to be
purchased140,000221,500142,000503,500
&APage &P
LaborAprilMayJuneQuarterProduction in
units26,00046,00029,000101,000Direct labor
hours0.050.050.050.05Labor hours
required1,3002,3001,4505,050Guaranteed labor
hours1,5001,5001,500Labor hours paid1,5002,3001,5005,300Wage
rate$10$10$10$10total direct labot
cost$15,000$23,000$15,000$53,000
&APage &P
OverheadAprilMayJuneQuarterProduction in
units26,00046,00029,000101,000Variable mfg. OH rate$1$1$1$1Variable
mfg. OH costs$26,000$46,000$29,000$101,000Fixed mfg. OH
costs50,00050,00050,000150,000Total mfg. OH
costs$76,000$96,000$79,000$251,000Less: noncash
costs20,00020,00020,00060,000Cash disbursements for manufacturing
OH$56,000$76,000$59,000$191,000
&APage &P
Eding Inv.Production costs per unitQuantityCostTotalDirect
materials5.00lbs.$0.40$2.00Direct
labor0.05hrs.$10.00$0.50Manufacturing
overhead0.05hrs.$49.70$2.49$4.99Budgeted finished goods
inventoryEnding inventory in units3,000Unit product cost$4.99Ending
finished goods inventory$14,970
&APage &P
SellingAprilMayJuneQuarterSales in
units20,00050,00030,000100,000Variable selling and admin.
rate$0.50$0.50$0.50$0.50Variable
expense$10,000$25,000$15,000$50,000Fixed selling and admin.
expense70,00070,00070,000210,000Total
expense80,00095,00085,000260,000Less: noncash
expenses10,00010,00010,00030,000Cash disburse-ments for selling
& admin.$70,000$85,000$75,000$230,000
&APage &P
Cash inAprilMayJuneQuarterAccounts rec. - March
31$30,000$30,000April sales70% x $200,000140,000140,00025% x
$200,000$50,00050,000May sales70% x $500,000350,000350,00025% x
$500,000$125,000125,000June sales70% x $300,000210,000210,000Total
cash collections$170,000$400,000$335,000$905,000
&APage &P
Cash MaterialsAprilMayJuneQuarterAccounts pay. March
31$12,000$12,000April purchases50% x $5600028,00028,00050% x
$56000$28,00028,000May purchases50% x $88,60044,30044,30050% x
$88600$44,30044,300June purchases50% x $56,80028,40028,400Total
cash payments for materials$40,000$72,300$72,700$185,000
&APage &P
CashAprilMayJuneQuarterBeginning cash
balance$40,000$30,000$30,000$40,000Add: cash
collections170,000400,000325,000905,000Total cash
available210,000430,000355,000945,000Less:
disbursementsMaterials40,00072,30072,700185,000Direct
labor15,00023,00015,00053,000Mfg.
overhead56,00076,00059,000191,000Selling and
admin.70,00085,00075,000230,000Equipment
purchase0.0143,70048,300192,000Dividends49,0000.00.049,000230,000400,000270,000900,000Excess
(deficiency) of Cash available over
disbursements(20,000)30,00085,00045,000
&APage &P
Sheet11AprilMayJuneQuarterExcess (deficiency) of Cash available
over
disbursements$(20,000)$30,000$95,000$45,000Financing:Borrowing50,0000.00.050,000Repayments0.00.0(50,000)(50,000)Interest0.00.0(2,000)(2,000)Total
financing50,0000.0(52,000)(2,000)Ending cash
balance$30,000$30,00043,000$43,000
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ProductionAprilMayJuneQuarterSales in units20,000Add: desired
end. inventoryTotal neededLess: beg. inventoryUnits to be
startedMay sales (sales budget)50,000Percent of inventory
desired20%Desired ending inventory10,000
&APage &P
ProductionAprilMayJuneQuarterSales in units20,000Add: desired
end. inventory10,000Total needed30,000Less: beg. inventoryUnits to
be startedMay sales (sales budget)50,000Percent of inventory
desired20%Desired ending inventory10,000
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Sheet1May sales50,000unitsDesired percent20%Desired
inventory10,000units
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ProductionAprilMayJuneQuarterSales in units20,000Add: desired
end. inventory10,000Total needed30,000Less: beg.
inventory4,000Units to be started26,000May sales (sales
budget)50,000Percent of inventory desired20%Desired ending
inventory10,000
&APage &P
ProductionAprilMayJuneQuarterSales in units20,00050,000Add:
desired end. inventory10,0006,000Total needed30,00056,000Less: beg.
inventory4,00010,000Units to be started26,00046,000May sales (sales
budget)50,000Percent of inventory desired20%Desired ending
inventory10,000
&APage &P
ProductionAprilMayJuneQuarterSales in
units20,00050,00030,000100,000Add: desired end.
inventory10,0006,0005,0005,000Total
needed30,00056,00035,000105,000Less: beg.
inventory4,00010,0006,0004,000Units to be
started26,00046,00029,000101,000May sales (sales
budget)50,000Percent of inventory desired20%Desired ending
inventory10,000
&APage &P
MaterialsAprilMayJuneQuarterProduction in
units26,00046,00029,000101,000Materials per unit5555Production
needs130,000230,000145,000505,000Add: desired ending
inventory23,00014,50011,50011,500Total
needed153,000244,500156,500516,500Less: beginning
inventory13,00023,00014,50013,000Materials to be
purchased140,000221,500142,000503,500
&APage &P
Sheet1June Ending InventoryJuly production in
units23,000Materials per unit5Total units needed115,000Inventory
percentage10%June desired ending inventory11,500
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Sheet1July ProductionSales in units25,000Add: desired ending
inventory3,000Total units needed28,000Less: beginning
inventory5,000Production in units23,000
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Sheet1AprilMayJuneQuarterIndirect
labor$17,500$26,500$17,900$61,900Indirect
material7,00012,6008,60028,200Utilities4,2008,4005,20017,800Rent13,30013,30013,30039,900Insurance5,8005,8005,80017,400Maintenance8,2009,4008,20025,800$56,000$76,000$59,000$191,000
Sheet2
Sheet3
Cash inAprilMayJuneQuarterAccounts rec. -
3/31$30,000$30,000April sales70% x $200,000140,000140,00025% x
$200,000$50,00050,000Total cash collections$170,000
&APage &P
Cash inAprilMayJuneQuarterAccounts rec. -
3/31$30,000$30,000April sales70% x $200,000140,000140,00025% x
$200,000$50,00050,000May sales70% x $500,000350,000350,00025% x
$500,000$125,000125,000June sales70% x $300,000210,000210,000Total
cash collections$170,000$400,000$335,000$905,000
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Sheet11AprilMayJuneQuarterExcess (deficiency) of Cash available
over
disbursements$(5,000)Financing:Borrowing35,000Repayments0.0Interest0.0Total
financing35,000Ending cash balance$30,000
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Sheet11AprilMayJuneQuarterExcess (deficiency) of Cash available
over
disbursements$(5,000)$16,200Financing:Borrowing35,00013,800Repayments0.00.0Interest0.00.0Total
financing35,00013,800Ending cash balance$30,000$30,000
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CashAprilMayJuneQuarterBeginning cash
balance$40,000$30,000$30,000Add: cash
collections170,000400,000335,000Total cash
available210,000430,000365,000Less:
disbursementsMaterials40,00072,30072,700Direct
labor24,00036,80024,000Mfg. overhead56,00076,00059,000Selling and
admin.70,00085,00075,000Equipment
purchase0.0143,70048,300Dividends25,0000.00.0Total
disbursements215,000413,800279,000Excess (deficiency) of Cash
available over disbursements$(5,000)$16,200$86,000
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Sheet11AprilMayJuneQuarterExcess (deficiency) of Cash available
over
disbursements$(5,000)$16,200$86,000Financing:Borrowing35,00013,800Repayments0.00.0(48,800)Interest0.00.0(838)Total
financing35,00013,800(49,638)Ending cash
balance$30,000$30,000$36,362
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Sheet1BorrowingRateAnnual InterestMonths OutstandingInterest
Expense$35,00012%=$4,2002 mths=$70013,80012%=1,6561
mth.=138$838
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Sheet11AprilMayJuneQuarterExcess (deficiency) of Cash available
over
disbursements$(5,000)$16,200$86,000$37,200Financing:Borrowing35,00013,80048,800Repayments0.00.0(48,800)(48,800)Interest0.00.0(838)(838)Total
financing35,00013,800(49,638)(838)Ending cash
balance$30,000$30,000$36,362$36,362
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Eding Inv.Production costs per unitQuantityCostTotalDirect
materials5.00lbs.$0.40$2.00Direct
labor0.10hrs.$8.000.80Manufacturing
overhead0.10hrs.$18.021.80$4.60Budgeted finished goods
inventoryEnding inventory in units5,000Unit product cost$4.60Ending
finished goods inventory$23,000
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Sheet119100010600Breakers, Inc.18.0188679245Budgeted Income
StatementFor the Three Months Ended June 30Revenue (100,000
$10)$1,000,000Cost of goods sold (100,000 $4.60)460,000Gross
margin540,000Operating expenses:Selling and admin.
Expenses$260,000Interest expense838Total operating
expenses260,838Net income$279,162
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Sheet6
Sheet1Royal CompanyBudgeted Income StatementFor the Three Month
Ended June 30, 19X1Sales (100,000 units @ $10)$1,000,000Cost of
goods sold (100,000 @ $4.99)499,000Gross margin501,000Selling and
administrative expenses230,000Operating income271,000Interest
expense2,000Net income$269,000Breakers, Inc.Budgeted Balance
SheetJune 30Current assetsCash$36,362Accounts receivable75,000Raw
materials inventory4,600Finished goods inventory23,000Total current
assets138,962Property and
equipmentLand50,000Building148,000Equipment192,000Total property
and equipment390,000Total assets$528,962Accounts
payable$28,400Common stock200,000Retained earnings300,562Total
liabilities and equities$528,962
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Sheet2
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Sheet1Royal CompanyBudgeted Income StatementFor the Three Month
Ended June 30, 19X1Sales (100,000 units @ $10)$1,000,000Cost of
goods sold (100,000 @ $4.99)499,000Gross margin501,000Selling and
administrative expenses230,000Operating income271,000Interest
expense2,000Net income$269,000Breakers, Inc.Budgeted Balance
SheetJune 30Current assetsCash$36,362Accounts receivable75,000Raw
materials inventory4,600Finished goods inventory23,000Total current
assets138,962Property and
equipmentLand50,000Building148,000Equipment192,000Total property
and equipment390,000Total assets$528,962Accounts
payable$28,400Common stock200,000Retained earnings300,562Total
liabilities and equities$528,962
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FinRoyal CompanyBudgeted Income StatementFor the Three Month
Ended June 30, 19X1Sales (100,000 units @ $10)$1,000,000Beginning
balance$46,400Cost of goods sold (100,000 @ $4.99)499,000Add: net
income279,162Gross margin501,000Deduct: dividends(25,000)Selling
and administrative expenses230,000Ending balance$300,562Operating
income271,000Interest expense2,000Net income$269,000Royal
CompanyBudgeted Balance SheetJune 30, 19X1Current
assetsCash$43,000Accounts receivable75,000Raw materials
inventory4,600Finished goods inventory24,950Total current
assets147,550Property and
equipmentLand50,000Building175,000Equipment192,000Total property
and equipment417,000Total assets$564,550Accounts
payable$28,400Common stock200,000Retained earnings336,150Total
liabilities and equities$564,550
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