REQUIREMENTS:
1) Construct Manny's budgeted cost of goods sold and operating income statement for December and the total for the 4th quarter. October and November have already been provided. Complete the template provided below. Show any necessary calculations. You may use either the high forecast or the low forecast for this budget. Choose either the high or the low.
2) Using the same forecast as in requirement 1 construct Manny's budget for raw materials purchases in December and the total for the 4th
quarter (You will also have to complete the budget for November) Complete the template provided which already has information for October and November.
3) Using the same forecast as you used in requirement 1 construct Manny's cash budgets for December and the total for the 4th quarter (You will also have to provide the missing number for November payments for purchases). Complete the templates provided below which already have information for October and November. Show any necessary calculations. Note: there are no capital expenditures or dividends budgeted for December.
4) Using the same forecast as you used in requirement 1 construct Manny's budgeted balance sheet at the end of December. Complete the template provided which already has the September 30 balances.
5) During September Manny actually produced and sold 17,500 valves. Actual sales revenues were $381,950. Actual costs and the original budget based on 18,000 units were as detailed in the table below. Complete the table by constructing a flexible budget based on 17,500 valves and determining the variances for the performance report. Your performance report should be similar to the performance report shown in exhibit 10.13 of page 611 except your report includes more detailed production cost line items. Use the template provided below for your answer.
6) Write a brief report explaining some possible reasons why Manny's profits were different from the amount projected in the master budget for September.