Prepare a selling and administrative expenses budget for Screenshot Tops, Inc. for the year ending December 31, 20xx. Screenshot Tops, Inc. Selling and Administrative Expenses Budget For the Year Ended December 31, 20xx Quarter 1 2 3 4 Year Variable expenses: Sales commissions Total variable expenses Fixed expenses: Advertising

Rent Sales salaries Office salaries Depreciation Property taxes and insurance Total fixed expenses Total selling and administrative expenses 9. Prepare a silk-screen overhead expenses budget for Screenshot Tops, Inc. for the year ending December 31, 20xx. Screenshot Tops, Inc. Silk-screen Overhead Expenses Budget For the Year Ended December 31, 20xx Quarter 1 2 3 4 Year Variable expenses: Ink Maintenance Utilities Graphics design Total variable expenses Fixed expenses: Rent Maintenance Utilities Graphics design Property taxes and insurance Depreciation Total fixed expenses Total silk-screen overhead Direct silk-screen hours Overhead rate per silk-screen hour 10. Using the information found in the case and the previous budgets, prepare a budgeted income statement for Screenshot Tops, Inc. for the year ended December 31, 20xx. Screenshot Tops, Inc. Budgeted Income Statement For the Year Ended December 31, 20xx Sales Cost of goods sold Gross profit Selling and administrative expenses Income from operations Interest expense

Income before income taxes Income tax expense Net income 11. Using the information found in the case and the previous budgets, prepare a cash budget for Screenshot Tops, Inc. for the year ended December 31, 20xx. Screenshot Tops, Inc. Cash Budget For the Four Quarters Ended December 31, 20xx Quarter 1 2 3 4 Beginning cash balance Add: Receipts Collections from customers Total available cash Less: Disbursements Payments for shirt purchases Silk-screen labor Silk-screen overhead Selling and administrative expenses Payment for equipment purchase Total disbursements Excess (deficiency) of available cash over disbursements Financing Borrowings Ending cash balance 12. Using the information contained in the case and the previous budgets, prepare a budgeted balance sheet for Screenshot Tops, Inc. at December 31, 20xx. Screenshot Tops, Inc. Budgeted Balance Sheet December 31, 20xx Assets Cash Accounts receivable Shirt inventory Equipment Less: Accumulated depreciation Total assets

Liabilities and Stockholders Equity Accounts payable Notes payable Interest payable Taxes payable Total liabilities Common stock Retained earnings Total stockholders equity Total liabilities and stockholders equity 13. Using the information contained in the case and the previous budgets, a) calculate the estimated contribution margin per unit for 20xx. (Hint: Silk-screened labor and the taxes are both fixed costs.) b) Calculate the total estimated fixed costs for 20xx (including interest and taxes). c) Compute the break-even point in units and dollars for 20xx. 14. Michael is very disappointed that the company did not have an income of $25,000 for its first year of budgeted operations as he had wanted. How many shirts would the company have had to sell in order to have a pretax profit of $25,000? (Ignore changes in income tax expense.) 15. Why does the companys cash balance differ from the net income for the year? 16. Do you think it was a good idea to offer Cary a salary plus 10% of sales? Why or why not? What other thoughts do you have?

PLEASE SHOW CALCULATIONS IN EXCEL

Check Figures: Total fixed selling and admin $ 23,280 Total variable overhead $ 46,650 Income before taxes $ 24,670 Ending cash $ 20,380 Total assets $ 137,270 Your calculations/final numbers should match those above.