Hampton Freeze, Inc.

Balance Sheet
December 31, 2014

Assets
Current Assets:
Cash 42,500
Accounts Receivable 90,000
Raw materials inventory (21,000 pounds) 4,200
Finished goods inventory (2,000 cases) 26,000
Total current assets 162,700
Plant and equipment:
Land 80,000
Buildings and equipment 700,000
Accumulated depreciation -292,000
Plant and equipment, net 488,000
Total Assets 650,700

Liabilities and Stockholders' Equity

Current liabilities:
Accounts Payable 25,800
Stockholders' equity:
Common stock 175,000
Retained earnings 449,900
Total stockholders' equity 624,900
Total liabilities and stockholders' equity 650,700
 Hampton Freeze, Inc.
Budgeting Asssumptions
For the Year Ended December 31, 2015

All 4 Quarters Quarte

Sales Budget 1
Budgeted sales in cases 10,000
Selling price per case 20 200000
Percentage of sales collected in the quarter of sale 80% 160000
Percentage of sales collected in the quarter after sale 20% 40000

Production Budget
Percentage of next quarter's sales in ending finished goods inventory 20% 6000

Direct Materials Budget

Pounds of sugar per case 15
Cost per pound of sugar 0.2
Percentage of next quarter's production needs in ending inventory 10%
Percentage of purchases paid in the quarter purchased 40%
Percentage of purchases paid in the quarter after purchase 60%

Direct Labor Budget

Direct labor-hours required per case 40%
Direct labor cost per hour 15

Manufacturing Overhead Budget

Variable manufacturing overhead per direct labor-hour 4
Fixed manufacturing overhead per quarter 60,600
Depreciation per quarter 15,000

Selling and Administrartive Expense Budget

Variable selling and administrative expense per case 1.8
Fixed selling and administrative expense per quarter
Advertising 20,000
executive salaries 55,000
Insurance 10,000
Property tax 4,000
Depreciation 10,000

Cash Budget
minimum cash balance $30,000
Equipment purchases 50,000
Dividends 8,000
Simple interest rate per quarter 4%
 Quarter
2 3 4
30,000 40,000 20,000
600000 800000 400000
480000 640000 320000
120000 160000 80000

8000 4000 3000

40,000 20,000 20,000

 Hampton Freeze, Inc.
Sales Budget
For the Year Ended December 31,2015

Quarter
1 2 3
Budegeted unit sales (in cases) 10,000 30,000 40,000
Sellling price per unit $20.00 $20.00 $20.00
Total Sales $200,000.00 $600,000.00 $800,000.00

Schedule of Expected Cash Collections

Beginning accounts receivable 90,000
First-quarter Sales $160,000.00 $40,000.00
Second-quarter Sales $480,000.00 $120,000.00
Third-quarter Sales $640,000.00
Fourth-quarter Sales
Total Cash Collections $250,000.00 $520,000.00 $760,000.00
 4 Year
20,000 100,000
$20.00 $20.00
$400,000.00 $2,000,000.00

90,000
$200,000.00
$600,000.00
$160,000.00 $800,000.00
$320,000.00 $320,000.00
$480,000.00 $2,010,000.00
 Hampton Freeze, Inc.
Production Budget
For the Year Ended December 31, 2015
(in cases)

Quarter
1 2 3
Budgeted unit sales (Schedule 1) 10,000 30,000 40,000
Add desired units of ending finished goods inventory 6000 8000 4000
Total needs 16,000 38,000 44,000
Less units of Beginning finished goods invetory 2,000 6,000 8,000
Requred Production units 14,000 32,000 36,000
 Assumed
er
4 Year
20,000 100,000
3000 3000
23,000 103,000
4,000 2,000
19,000 101,000
 Hampton Freeze, Inc.
Direct Materials Budget
For the Year Ended December 31, 2015

Quarter
1 2 3
Required production in cases (Schedule 2) 14,000 32,000 36,000
Units of raw materials needed per case 15 15 15
Units of raw materials needed to meet production 210000 480000 540000
Add desired units of ending raw materials inventory 48000 54000 28500
Total units of raw materials needed 258000 534000 568500
Less units of beginning raw materials inventory 21000 48000 54000
Units of raw materials to be purchased 237000 486000 514500
Cost of raw materials per pound $0.20 $0.20 $0.20
Cost of raw materials to be purchased $47,400.00 $97,200.00 $102,900.00

Schedule of Expected Cash Disbursements for Purchases of Materials

Beginning Accounts Payable $25,800

First-quarter purchases $18,960.00 $28,440.00
Second-quarter purchases $38,880.00 $58,320.00
Third-quarter purchases $41,160.00
Fourth-quarter purchases
Total cash disbursements for materials $44,760.00 $67,320.00 $99,480.00
 4 Year
19,000 101000
15 15
285000 1515000
22500 22500
307500 1537500
28500 21000
279000 1516500
$0.20 $0.20
$55,800.00 $303,300.00

Materials

$25,800
$47,400
$97,200
$61,740.00 $102,900
$22,320.00 $22,320
$84,060.00 $295,620.00
 Hampton Freeze, Inc.
Direct Labor Budget
For the Year Ended December 31, 2015

Quarter
1 2 3 4
Required production in cases (Schedule 2) 14,000 32,000 36,000 19,000
Direct labor-hours per case 40% 40% 40% 40%
Total direct labor-hours needed 5600 12800 14400 7600
Direct labor cost per hour $15.00 $15.00 $15.00 $15.00
Total direct labor cost $84,000.00 $192,000.00 $216,000.00 $114,000.00
 Year
101000
40%
40400
$15.00
$606,000.00
 Hampton Freeze, Inc.
Manufacturing Overhead Budget
For the Year Ended December 31, 2015

Quarter
1 2 3 4 Year
Budgeted direct labor-hours (Schedule 4) 5600 12800 14400 7600 40400
Variable manufacturing overhead rate $4 $4 $4 $4 $4
Variable manufacturing overhead $22,400 $51,200 $57,600 $30,400 161600
Fixed manufacturing overhead 60,600 60,600 60,600 60,600 242400
Total Manufacturing overhead $83,000 $111,800 $118,200 $91,000 $404,000
Less depreciation $15,000 $15,000 $15,000 $15,000 60000
Cash Disbursements for manufacturing overhead $68,000 $96,800 $103,200 $76,000 $344,000

Total Manufacturing overhead (a) $404,000

Budgeted direct labor-hours (b) 40400
Predetermined overhead rate for the yea (a)/(b) $10
 Hampton Freeze, Inc.
Ending Finished Goods Inventory Budget
(absorption costing basis)
For the Year Ended December 31, 2015

Item Quantity Cost Total

Production per case:
Direct materials 15 pounds $0.20 per pound $3
Direct labor 40% hours 15 per hour 6
Manufacturing overhead 40% hours 10 per hour 4
Unit product cost 13.00

Budgeted finished goods inventory

Ending finished goods inventory in cases (schedule 2) 3000
Unit product cost (see above) $13
Ending finished goods inventory in dollar $39,000
 Hampton Freeze, Inc.
Selling and Administrative Expense Budget
For the Year Ended December 31, 2015

Quarter
1 2 3
Budgeted units sales (Schedule 1) 10,000 30,000 40,000
Variable selling and administrative expense per case $1.80 $1.80 $1.80
Variable selling and administrative expense $18,000.00 $54,000.00 $72,000.00
Fixed selling and administrative expense:
Advertising 20,000 20,000 20,000
Executive salaries 55,000 55,000 55,000
Insurance 10,000 10,000 10,000
Property taxes 4,000 4,000 4,000
Depreciation 10,000 10,000 10,000
Total fixed selling and administrative expenses 99000 99000 99000
Total selling and administrative expenses $117,000.00 $153,000.00 $171,000.00
Less depreciation 10,000 10,000 10,000
Cash disbursements for selling and administrative expenses $107,000.00 $143,000.00 $161,000.00
r
4 Year
20,000 100000
$1.80 $1.80
$36,000.00 $180,000.00

20,000 80,000
55,000 220,000
10,000 40,000
4,000 16000
10,000 40000
99000 396000
$135,000.00 $576,000.00
10,000 40000
$125,000.00 $536,000.00
 Hampton Freeze, Inc.
Cash Budget
For the Year Ended December 31, 2015

Quarter
Schedule 1 2 3
Beginning cash balance 42,500 60740 103620
Add cash receipts
Collections from customer 1 250000 520000 760000
Total cash disbursements 292,500 580,740 863,620
Less cash disbursements
Direct materials 3 44760 67320 99480
Direct labor 4 84000 192000 216000
Manufacturing overhead 5 68000 96800 103200
Selling and administrative 7 107000 143000 161000
Equipment purchases 50,000 40,000 20,000
Dividends 8,000 8,000 8,000
Total cash disbursements 361760 547120 607680
Excess (deficiency) of cash available over disbursements -69260 33620 255940
Financing:
Borrowings (at the beginnings of quarters) 130000 70000
Repayment (at the end of the year)
Interest
Total Financing 130000 70000 0
Ending cash balance 60740 103620 255940

contin
arter
4 Year
255940 42,500

480000 2010000
735,940 2,052,500

84060 295620
114000 606000
76000 344000
125000 536000
20,000 130000
8,000 32000
427060 1943620
308880 108880

200000
-200000 -200000
-21900 -21900
-221900 -21900
86980 86980
 Hampton Freeze, Inc.
Budegted Income Statement
For the Year Ended December 31,2015

Schedules
Sales 1 $2,000,000
Cost of Goods Sold 1,6 1,300,000
Gross Margin $700,000
Selling and Administrartive expenses 7 576,000
Net Operating Income $124,000
Interest Expense 8 21,900
Net Income $102,100
 Hampton Freeze, Inc.
Budgeted Balance Sheet
31-Dec-15

Assets
Current Assets:
Cash $86,980 (a)
Accounts Receivable 80,000 (b)
Raw Materials Inventory 4,500 (c )
Finished Goods Inventory 39,000 (d)
Total Current Assets $210,480
Plant and Equipment
Land 80,000 (e)
Buildings and Equipment 830,000 (f)
Accumulated depreciation -392,000 (g)
Plant and Equipment, net 518,000
Total Assets $728,480

Liabilities and Stockholders' Equity

Current liabilities
Accounts Payable $33,480 (h)
Stockholders' equity
Common stock no par $175,000
Retained earnings 520,000
Total stockholders' equity $695,000
Total liabilities and stockholders' equity $728,480