Project Description:
first on master budjet i need to find the following Required:
a.Prepare a Balance Sheet as of December 31, 2011
b.Prepare a Budgeted Income Statement for the first quarter of 2012
c.Prepare a Purchase Budget , a Sales Budget and a Cash Budget for the first quarter of 2012
d.Show the amount of Accounts Receivable and Accounts Payable as of the end of first quarter of 2012
e.The company is discussing the possibility of expanding its collection to include an Indian Fashions section late in the first quarter of 2012. The section’s construction and related cost would require an additional cash of AED 50,000. Assuming the company still wants to maintain a minimum cash requirement of AED 20,000 at the end of the first quarter, can a new section be added without obtaining additional fund? If not, what alternatives the company should consider to get the required funds.
second i need to find out the CVP Required:
1.Assuming sales of $30,000,000, construct a budgeted contribution margin format income statement for the upcoming year for each of the following alternatives:
a.The independent sales agents’ commission rate will remain unchanged at 18%.
b.The independent sales agents’ commission rate will increase to 20%.
c.The company employs its’ own sales force.
2.Calculate Wallace Corporation’s break-even point in sales dollars for the upcoming year assuming the above three alternatives mentioned in 1 above.
3.Refer to your answer to 1(b) above. If the company employs its’ own sales force, what volume of sales would be necessary to generate the net operating income the company would realize if sales are $3,000,000 and the company continues to sell enough agents (at 20% commission rate)?
4.Write a memo to the president of Wallace Corporation in which you make a recommendation as to whether the company should continue to use independent sales agents (at 20% commission rate) or employ its own sales force. Fully explain the reasons for your recommendation in the memo.
