E-lan electronics budgeting project: | Accounting homework help

I am the head accountant for E-Lan Electronics, I am responsible to prepare the company’s master budget for the next fiscal period. The administrative and divisional managers have prepared the appropriate information (found below) for me I need to prepare the budget. In addition to the compiled information, I will also find the budgets, reports, questions, and statements required by the CFO.

Step 1

E-Lan Electronics produces Widgets for sale at local electronic stores. The company is in the process of creating a master budget for the first quarter of the coming year. Results from the prior year are:

Last Year                           Units

January                             220,000

February                           268,000

March                               240,000

April                                   210,000

May                                   230,000

Unit Sales are to expected increase 15% and each unit is expected to sell for $39. The management prefers to maintain ending finished goods inventory equal to 10% of next month’s sales.

1. I will need to prepare an sales budget for E-Lan Electronics

2. Prepare a production budget for E-Lan Electronics

Step 2

E-Lan Electronics is now preparing the budget for direct materials purchases, direct labor, and manufacturing overhead.

Each unit production requires                  1 Gizmo and                                   3 Flobs

E-Lan pays                                                     $ 7 per Gizmo and                        $ 2.50 per Flob

Management prefers to maintain ending raw materials inventory equal to materials 30% of next month needed in production.

Raw materials inventory at the end of last year met that requirement.

Each unit of production requires 0.8 direct labor hours at a cost of $ 18.00 per hour.

Variable overhead costs are:

Indirect materials                          $ 0.38 per unit

Indirect Labor                                $ 1.20 per unit

Other                                               $ 1.12 per unit

Fixed overhead costs per month:

Salaries                                            $ 212,000

Rent                                                 $ 16,000

Depreciation                                  $ 27,000

1. I need to prepare an direct materials purchases budget for E-Lan Electronics

2. I need to prepare an direct labor budget for E-Lan Electronics

3. I need to prepare an manufacturing overhead budget for E-Lan Electronics

Step 3

E-Lan Electronics expects the following as pertaining to the capital expenditures and cash budgets.

Capital Expenditures

The company plans to purchase selling and administrative equipment totaling $ 180,000

The company plans to purchase Production equipment totaling $ 3,100,000

Both will be purchased at the end of the March from operating cash flow and will not affect depreciation expense for the first quarter.

Cash Budget

All sales are on credit. The company expects to collect 75% of sales in the month of sale, 22% of sales in the month following the sale, 3% percent will be uncollectable. Accounts receivable at the end of last year totaled $ 1,980,000 this represents the collectable amount of December sales.

The company give credit terms of 2 / EOM, n/EOM second month

All direct materials purchases are on credit. The company expects to pay 70% of purchases in the month of purchase and 30% the following month.

Accounts Payable to be paid in January is $ 1,640,000

The company has a credit line of $3,000,000 for operations with an interest rate of 12% APR. At the end of every month, the cash balance should be a minimum of $ 50,000.

The cash budget should include an estimate of amounts to be borrowed or returned to the credit line, and an estimated balance of the credit line.

The Credit line has a balance at the end of December of $ 362,000

The company has good credit and can borrow funds on a secured basis at 4% but has not done so.

E-Lan Electronics expects the following Selling and Administrative Expenses

Salaries                             $ 15,000

Rent                                   $ 17,000

Advertising                       $ 82,000

Depreciation                    $ 18,500

Other                                 $ 6,700

Sales Commissions         $ 1.50 Per Unit  

Interest 12% annual rate. Paid on last months ending balance of Credit Line

1. I need to prepare an Selling and Administrative Budget

2. I need to prepare an capital expenditures budget

3. I need to prepare an cash budget

4. What Problems exists in regards to the operating line? What is the cause? What should be done to remedy the situation?

How much would it save the company going forward?

5. Prepare a budgeted Income Statement

(Cost of Goods Sold should be calculated based on estimated costs of production for the quarter.)

Step 4

Net Plant and Equipment as of December 31 was                          $ 7,800,000

Common Stock account Did not change                                            $ 1,200,000

Retained Earnings as of December 31 was                                       $ 8,575,191.93

I need to prepare the Budgeted Balance Sheet.

Get 20% Discount on This Paper
Pages (550 words)
Approximate price: -

Try it now!

Get 20% Discount on This Paper

We'll send you the first draft for approval by at
Total price:

How it works?

Follow these simple steps to get your paper done

Place your order

Fill in the order form and provide all details of your assignment.

Proceed with the payment

Choose the payment system that suits you most.

Receive the final file

Once your paper is ready, we will email it to you.

Our Services

Assignment Help has assembled a team of highly skilled writers with diverse experience in the online writing circles. Our aim is to become a one stop shop for all your Academic/ online writing. Check out below our amazing service!


Essay Writing Services

At Assignment Help, we prioritize on all aspects that creates a good grade such as impeccable grammar, proper structure, zero-plagiarism, and conformance to guidelines. The principal purpose of essay writing is to present the author's evaluation concerning a singular subject about which they have made. Since Professionalism is the mother of every success, try our team of experienced writers in helping you complete your essays and other assignments.


Admission Papers

You have been trying to join that prestigious institution you long yearned for, but the hurdle of an admission essay has become a stumbling block. We have your back, with our proven team that has gained invaluable experience over time, your chance of joining that institution is now! Just let us work on that essay.How do you write an admission essay? How do you begin the essay? For answers, try Quality Custom Writers Now!


Editing and Proofreading

Regardless of whether you're pleased with your composing abilities, it's never an impractical notion to have a second eye go through your work. The best editing services leaves no mistake untouched. We recognize the stuff needed to polish up a writing; as a component of our editing and proofreading, we'll change and refine your write up to guarantee it's amazing, and blunder free. Our group of expert editors will examine your work, giving an impeccable touch of English while ensuring your punctuation and sentence structures are top-notch.


Technical papers

We pride ourselves in having a team of clinical writers. The stringent and rigorous vetting process ensures that only the best persons for job. We hire qualified PhD and MA writers only. We equally offer our team of writers bonuses and incentives to motivate their working spirit in terms of delivering original, unique, and informative content. They are our resources drawn from diverse fields. Therefore your technical paper is in the right hands. Every paper is assessed and only the writers with the technical know-how in that field get to work on it.


College Essay Writing

If all along you have been looking for a trustworthy college essay service provider that provides superb academic papers at reasonable prices, then be glad that you search has ended with us. We are your best choice! Get high-quality college essay writing from our magnificent team of knowledgeable and dedicated writers right now!


Quality Assignment/Homework Help

We give the students premium quality assignments, without alarming them with plagiarism and referencing issues. We ensure that the assignments stick to the rules given by the tutors. We are specific about the deadlines you give us. We assure you that you will get your papers well in advance, knowing that you will review and return it if there are any changes, which should be incorporated.