Professional Fees Earned Budget for a Service Company Lundquist & Fretwell, CPAS, offer three types of services to clients: auditing, tax, and small business accounting. Based on experience and projected growth, the following billable hours have been estimated for the year ending May 31, 20Y8: Billable Hours Audit Department: Staff 25,000 Partners 6,000 Tax Department: Staff 40,000 Partners 8,500 Small Business Accounting Department: Staff 5,000 Partners 500 The average billing rate for staff is $140 per hour, and the average billing rate for partners is $450 per hour. Prepare a professional fees earned budget for Lundquist & Fretwell, CPAS, for the year ending May 31, 20Y8. Lundquist & Fretwell, CPAS Professional Fees Earned Budget For the Year Ending May 31, 20Y8 Billable Hours Hourly Rate Total Revenue Audit Department: Staff Partners Total Tax Department: Staff Partners Total Small Business Accounting Department: Staff Partners Total Total professional fees earned

Professional Fees Earned Budget for a Service Company Lundquist & Fretwell, CPAS, offer three types of services to clients: auditing, tax, and small business accounting. Based on experience and projected growth, the following billable hours have been estimated for the year ending May 31, 20Y8: Billable Hours Audit Department: Staff 25,000 Partners 6,000 Tax Department: Staff 40,000 Partners 8,500 Small Business Accounting Department: Staff 5,000 Partners 500 The average billing rate for staff is $140 per hour, and the average billing rate for partners is $450 per hour. Prepare a professional fees earned budget for Lundquist & Fretwell, CPAS, for the year ending May 31, 20Y8. Lundquist & Fretwell, CPAS Professional Fees Earned Budget For the Year Ending May 31, 20Y8 Billable Hours Hourly Rate Total Revenue Audit Department: Staff Partners Total Tax Department: Staff Partners Total Small Business Accounting Department: Staff Partners Total Total professional fees earned

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter8: Budgeting

Section: Chapter Questions

Problem 7E: Professional foes earned budget for a service company LundquistFret well. CPAs, offer three types of...

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Professional labor cost budget for a service company Based on the data in Exercise 7 and assuming that the average compensation per hour for staff is 40 and for partners is 175, prepare a professional labor cost budget for each department forLundquist Fretwell, CPAs, for the year ending May 31, 20Y8. Use the following column headings:
Coral Seas Jewelry Company makes and sells costume jewelry. For the coming year, Coral Seas expects sales of 15.9 million and cost of goods sold of 8.75 million. Advertising is a key part of Coral Seas business strategy, and total marketing expense for the year is budgeted at 2.8 million. Total administrative expenses are expected to be 675,000. Coral Seas has no interest expense. Income taxes are paid at the rate of 40 percent of operating income. Required: 1. Construct a budgeted income statement for Coral Seas Jewelry Company for the coming year. 2. What if Coral Seas had interest payments of 500,000 during the year? What effect would that have on operating income? On income before taxes? On net income?
Operating Budget, Comprehensive Analysis Allison Manufacturing produces a subassembly used in the production of jet aircraft engines. The assembly is sold to engine manufacturers and aircraft maintenance facilities. Projected sales in units for the coming 5 months follow: The following data pertain to production policies and manufacturing specifications followed by Allison Manufacturing: a. Finished goods inventory on January 1 is 32,000 units, each costing 166.06. The desired ending inventory for each month is 80% of the next months sales. b. The data on materials used are as follows: Inventory policy dictates that sufficient materials be on hand at the end of the month to produce 50% of the next months production needs. This is exactly the amount of material on hand on December 31 of the prior year. c. The direct labor used per unit of output is 3 hours. The average direct labor cost per hour is 14.25. d. Overhead each month is estimated using a flexible budget formula. (Note: Activity is measured in direct labor hours.) e. Monthly selling and administrative expenses are also estimated using a flexible budgeting formula. (Note: Activity is measured in units sold.) f. The unit selling price of the subassembly is 205. g. All sales and purchases are for cash. The cash balance on January 1 equals 400,000. The firm requires a minimum ending balance of 50,000. If the firm develops a cash shortage by the end of the month, sufficient cash is borrowed to cover the shortage. Any cash borrowed is repaid at the end of the quarter, as is the interest due (cash borrowed at the end of the quarter is repaid at the end of the following quarter). The interest rate is 12% per annum. No money is owed at the beginning of January. Required: 1. Prepare a monthly operating budget for the first quarter with the following schedules. (Note: Assume that there is no change in work-in-process inventories.) a. Sales budget b. Production budget c. Direct materials purchases budget d. Direct labor budget e. Overhead budget f. Selling and administrative expenses budget g. Ending finished goods inventory budget h. Cost of goods sold budget i. Budgeted income statement j. Cash budget 2. CONCEPTUAL CONNECTION Form a group with two or three other students. Locate a manufacturing plant in your community that has headquarters elsewhere. Interview the controller for the plant regarding the master budgeting process. Ask when the process starts each year, what schedules and budgets are prepared at the plant level, how the controller forecasts the amounts, and how those schedules and budgets fit in with the overall corporate budget. Is the budgetary process participative? Also, find out how budgets are used for performance analysis. Write a summary of the interview.
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Relevant data from the Poster Companys operating budgets are: Additional data: Capital assets were sold in January for $10,000 and $4,500 in May. Dividends of $4,500 were paid in February. The beginning cash balance was $60,359 and a required minimum cash balance is $59,000. Use this information to prepare a cash budget for the first two quarters of the year
Mesa Aquatics, Inc. estimated direct labor hours as 1,900 in quarter 1, 2,000 in quarter 2.2,200 in quarter 3, and 1,800 in quarter 4. a sales and administration budget using the information provided.
Budget performance reports for cost centers Partially completed budget performance reports for Runquist Company, a manufacturer of air conditioners, are provided below. a.Complete the budget performance reports by determining the correct amounts for the lettered spaces. b.Compose a memo to Jeff Kitchens, president of Meridian Company, explaining the performance of the Production Division for June.
Product costing and decision analysis for a service company Blue Star Airline provides passenger airline service, using small jets. The airline connects four major cities: Charlotte, Pittsburgh, Detroit, and San Francisco. The company expects to fly 170,000 miles during a month. The following costs are budgeted for a month: Blue Star management wishes to assign these costs to individual flights in order to gauge the profitability of its service offerings. The following activity bases were identified with the budgeted costs: The size of the companys ground operation in each city is determined by the size of the workforce. The following monthly data are available from corporate records for each terminal operation: Three recent representative flights have been selected for the profitability study. Their characteristics are as follows: Instructions Determine the fuel, crew, and depreciation cost per mile flown. Determine the cost per arrival or departure by terminal city. Use the information in (1) and (2) to construct a profitability report for the three flights. Each flight has a single arrival and departure to its origin and destination city pairs.
Professional labor cost budget Based on the data in Exercise 13-5 and assuming that the average compensation per hour for staff is $36 and for partners is $300. prepare a professional labor cost budget for Day & Spieth, CPAs, for the year ending March 31. 20Y6. Use the following column headings: