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Budget Discussion Questions for Mama's Needlework

One question for budgeting, see question #6 in discussion question area. questions refer to excel problem page.

(See attached files for full problem description)

Discussion Questions for Mama's Needlework Budget

Production Schedule: Why doesn't the units produced each quarter match the units they plan to sell?
Production Schedule: Why did Mama decide to run low on inventory in Q2? (She likes to keep 1 month's sales in inventory, which is 30 units in Q2, but she only made enough to end up with 25 units)
DM Budget: Why are 15% of Mama's DM purchase paid for in the next quarter?
Direct Labor Budget: If labor costs $4.85 per hour in Q1, why is the labor cost per unit on $0.97?
Cash Budget: Why do you back out depreciation from the cash budget?
Cash Budget: Why doesn't the Net Cash from Operations of $93 match the Annual Budget $105? One reason is that our budget components were only for Product B. What is the other reason?
Cash Budget: Why did they borrow $50 in the first quarter?
Cash Budget: What is Mama's loan balance at the end of the year?
Cash Budget: Mama is angry. She want to take out her profits (probably around $75 after taxes) at the end of the year. I told her she can only have $25. Why?


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