Biffs Bakery is a medium-sized regional bakery that specializes in providing orders to grocery and convenience stores. Within the coming weeks, they are meeting with a venture capital firm in hopes to secure additional funding in order to meet their growth targets for the next few years.
The first part of the assignment (the spreadsheet) is to create a Master Budget using the data presented in the case. The spreadsheet is an individual assignment and one that you must complete on your own. The spreadsheet is due on Monday, November 18 by 2:20 PM. Please save your spreadsheet in your folder on the J drive.
Once the spreadsheets are submitted, the instructions for the second part of the assignment (the case study) will be handed out in class. The case study is a group assignment and will be completed in your teams.
Instructions for Part 1 – Creating the Master Budget
Read Part I of the case carefully and create a spreadsheet page for data input as you go. This is where you will find all the numbers necessary to create your budgets as you move through the assignment. It is important that you think through what numbers you will need and lay those out logically with clear labels. This serves two purposes: first, it will make it easier to create the budgets, and second, when you turn this budget over to management, they may wish to change some of the assumptions and see what results flow through the budget. To this end, you must show all assumptions in the Data Input worksheet.
You will need to create the following schedules – for 2013
· Revenues Budget, by quarter
· Production Budget (in units), by quarter (also include quarter 1 for 2014)
· Direct Material Usage & Purchases Budget, by quarter
· Direct Labor Budget, by quarter
· Manufacturing Overhead Budget, by quarter
· Ending Inventories Budget, including unit cost computation of finished goods
· Cost of Goods Sold Budget
· Selling & Administrative Expense Budget, by quarter for 2013
· Pro forma income statement
Make the spreadsheet document flow logically. Have the spreadsheet show most dollar amounts as whole dollars (in some cases, such as the price of an ingredient at $0.15, it won’t make sense to do so – use your judgment). Similarly, use your judgment on how many decimals to display and what format to use ($ or % for example) in each cell. Remember, that the calculations will still be accurate as Excel uses the decimal part of the number even if it isn’t showing. Also, a good use of bold, italics, color, and borders makes the spreadsheet more visually appealing and, if used correctly, easier to understand and use.