Question

 

Shadee Corp. expects to sell 530 sun visors in May and 360 in June. Each visor sells for $17. Shadee’s beginning and ending finished goods inventories for May are 65 and 40 units, respectively. Ending finished goods inventory for June will be 70 units.

Required:

1. Determine Shadee's budgeted total sales for May and June.

2. Determine Shadee's budgeted production in units for May and June.

Each visor requires a total of $4.50 in direct materials that includes an adjustable closure that the company purchases from a supplier at a cost of $2.00 each. Shadee wants to have 32 closures on hand on May 1, 23 closures on May 31, and 23 closures on June 30. Additionally, Shadee’s fixed manufacturing overhead is $700 per month, and variable manufacturing overhead is $1.50 per unit produced.

Required:

1. Determine Shadee's budgeted cost of closures purchased for May and June.

2. Determine Shadee's budget manufacturing overhead for May and June

Suppose that each visor takes 0.20 direct labor hours to produce and Shadee pays its workers $8 per hour.

Required:

Determine Shadee's budgeted direct labor cost for May and June. (Do not round your intermediate values. Round your answers to 2 decimal places.)

Answer 1