Question
In: Accounting
The following production budget for the four quarters of 2019: Quarter 1 Quarter 2 Quarter 3...
The following production budget for the four quarters of 2019:
|
Quarter 1 |
Quarter 2 |
Quarter 3 |
Quarter 4 |
|
|
Units |
3,000 |
4,000 |
5,000 |
8,000 |
Each units requires 4 kg of raw materials costing $6 per kilogram. On December 31, 2018, the ending inventory of raw materials was 3,000 kg. Management wants to have a raw materials inventory at the beginning of each quarter equal to 25% of the current quarter's production requirements in units. The production budget for the first quarter of 2020 will be 10,000 units.
Use the information provided to answer the following
questions:
a) What is the BEGINNING raw materials inventory
in kilograms of material for each quarter?
Quarter 1: Answer kilograms
Quarter 2: Answer kilograms
Quarter 3: Answer kilograms
Quarter 4: Answer kilograms
b) What is the ENDING raw materials inventory in kilograms of material for each quarter?
Quarter 1: Answer kilograms
Quarter 2: Answer kilograms
Quarter 3: Answer kilograms
Quarter 4: Answer kilograms
Prepare direct materials purchases budget for Quarter 2:
c) What are the total kilograms of raw material that are needed for
production in Quarter 4?
Answer kilograms
d) What are the total kilograms of raw material that need to be
purchased in Quarter 2?
Answer kilograms
e) What is the total cost of the raw materials purchased in
Quarter 3?
$ Answer
Solutions
Expert Solution
| Ans.a | Quarter 1 | Quarter 2 | Quarter 3 | Quarter 4 | |
| Budgeted production | 3000 | 4000 | 5000 | 8000 | |
| Materials requirements per unit | 4 | 4 | 4 | 4 | |
| Materials needed for production | 12000 | 16000 | 20000 | 32000 | |
| *Calculation of Beginning inventory: | |||||
| Quarter | |||||
| 1 | 12000*25% | 3000 | (given) | ||
| 2 | 16000*25% | 4000 | |||
| 3 | 20000*25% | 5000 | |||
| 4 | 32000*25% | 8000 | |||
| Ans.b | *Calculation of Ending inventory: | ||||
| Quarter | |||||
| 1 | 4000 | ||||
| 2 | 5000 | ||||
| 3 | 8000 | ||||
| 4 | 10000 | (40000*25%) | |||
|
Ending inventory of current quarter is beginning inventory of next quarter. |
|||||
| *Ending inventory for quarter 4 = Beginning inventory of next year's quarter 1. | |||||
| *Beginning inventory of 2020 quarter 1: | |||||
| Budgeted production | 10000 | ||||
| Materials requirements per unit | 4 | ||||
| Materials needed for production | 40000 | ||||
| Ans. | DIRECT MATERIALS BUDGET | ||||
| Quarter 2 | |||||
| Budgeted production | 4000 | ||||
| Materials requirements per unit | 4 | ||||
| Materials needed for production | 16000 | ||||
| Plus: Budgeted ending inventory (kg.) | 5000 | ||||
| Total materials requirements (kg.) | 21000 | ||||
| Less: Beginning inventory (kgs.) | -4000 | ||||
| Materials to be purchased | 17000 | ||||
| (X) Cost per kg. | 6 | ||||
| Total budgeted direct materials cost | 102000 | ||||
| Ans.c | Quarter 4 | ||||
| Budgeted production | 8000 | ||||
| Materials requirements per unit | 4 | ||||
| Materials needed for production | 32000 | ||||
| Ans.d | Quarter 2 | ||||
| Budgeted production | 4000 | ||||
| Materials requirements per unit | 4 | ||||
| Materials needed for production | 16000 | ||||
| Plus: Budgeted ending inventory (kg.) | 5000 | ||||
| Total materials requirements (kg.) | 21000 | ||||
| Less: Beginning inventory (kg.) | -4000 | ||||
| Materials to be purchased | 17000 | ||||
| Ans.e | Quarter 3 | ||||
| Budgeted production | 5000 | ||||
| Materials requirements per unit | 4 | ||||
| Materials needed for production | 20000 | ||||
| Plus: Budgeted ending inventory (kg.) | 8000 | ||||
| Total materials requirements (kg.) | 28000 | ||||
| Less: Beginning inventory (kgs.) | -5000 | ||||
| Materials to be purchased | 23000 | ||||
| (X) Cost per kg. | 6 | ||||
| Total cost of direct materials purchased | 138000 | ||||
ekkarill92 answered 2 years agoRelated Solutions
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Required:
1. Prepare the Sales budget for 2019.
2. Prepare the Production budget for 2019.
3. Prepare the Direct materials purchases budget (units and
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4. Prepare the Direct labor budget for 2019.
5. Prepare the Factory overhead budget for 2019.
6. Prepare the Cost of goods sold and ending finished goods
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MORRISEY & BROWN, LTD. Income Statements For the Four Quarters Ending December 31 Quarter 1 Quarter...
MORRISEY & BROWN, LTD.
Income Statements
For the Four Quarters Ending December 31
Quarter 1
Quarter 2
Quarter 3
Quarter 4
Sales in units
4,700
4,200
5,240
4,800
Sales revenue
A$
470,000
A$
420,000
A$
524,000
A$
480,000
Less: Cost of goods sold
282,000
252,000
314,400
288,000
Gross margin
188,000
168,000
209,600
192,000
Less: Operating expenses:
Advertising expense
21,200
21,200
21,200
21,200
Shipping expense
34,800
36,800
40,960
36,760
Salaries and commissions
79,200
78,400
90,880
86,160
Insurance expense
6,200
6,200
6,200...
Noventis Corporation prepared the following estimates for the four quarters of the current year: First Quarter...
Noventis Corporation prepared the following estimates for the
four quarters of the current year:
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter
Sales
$
1,400,000
$
1,680,000
$
1,960,000
$
2,240,000
Cost of goods sold
444,000
524,000
594,000
644,000
Administrative costs
450,000
255,000
260,000
270,000
Advertising costs
0
140,000
0
0
Executive bonuses
0
0
0
84,000
Provision for bad debts
0
0
0
50,000
Annual maintenance costs
68,000
0
0
0
Additional Information
First-quarter administrative costs include the $190,000...
Noventis Corporation prepared the following estimates for the four quarters of the current year: First Quarter...
Noventis Corporation prepared the following estimates for the
four quarters of the current year: First Quarter Second Quarter
Third Quarter Fourth Quarter Sales $ 1,100,000 $ 1,320,000 $
1,540,000 $ 1,760,000 Cost of goods sold 410,000 490,000 560,000
610,000 Administrative costs 270,000 165,000 170,000 180,000
Advertising costs 0 140,000 0 0 Executive bonuses 0 0 0 60,000
Provision for bad debts 0 0 0 56,000 Annual maintenance costs
64,000 0 0 0 Additional Information • First-quarter administrative
costs include the...
Noventis Corporation prepared the following estimates for the four quarters of the current year: First Quarter...
Noventis Corporation prepared the following estimates for the
four quarters of the current year:
First Quarter Second Quarter Third Quarter Fourth Quarter
Sales $ 1,100,000 $ 1,320,000 $ 1,540,000 $ 1,760,000
Cost of goods sold 410,000 490,000 560,000 610,000
Administrative costs 270,000 165,000 170,000 180,000
Advertising costs 0 140,000 0 0
Executive bonuses 0 0 0 60,000
Provision for bad debts 0 0 0 56,000
Annual maintenance costs 64,000 0 0 0
Additional Information • First-quarter administrative costs
include the...
Noventis Corporation prepared the following estimates for the four quarters of the current year: First Quarter...
Noventis Corporation prepared the following estimates for the
four quarters of the current year:
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter
Sales
$
1,150,000
$
1,380,000
$
1,610,000
$
1,840,000
Cost of goods sold
415,000
495,000
565,000
615,000
Administrative costs
280,000
170,000
175,000
185,000
Advertising costs
0
160,000
0
0
Executive bonuses
0
0
0
64,000
Provision for bad debts
0
0
0
58,000
Annual maintenance costs
66,000
0
0
0
Additional Information
First-quarter administrative costs include the $130,000...
Noventis Corporation prepared the following estimates for the four quarters of the current year: First Quarter...
Noventis Corporation prepared the following estimates for the
four quarters of the current year:
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter
Sales
$
1,500,000
$
1,800,000
$
2,100,000
$
2,400,000
Cost of goods sold
450,000
530,000
600,000
650,000
Administrative costs
350,000
205,000
210,000
220,000
Advertising costs
0
180,000
0
0
Executive bonuses
0
0
0
92,000
Provision for bad debts
0
0
0
72,000
Annual maintenance costs
80,000
0
0
0
Additional Information
First-quarter administrative costs include the $200,000...
Noventis Corporation prepared the following estimates for the four quarters of the current year: First Quarter...
Noventis Corporation prepared the following estimates for the
four quarters of the current year:
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter
Sales
$
1,500,000
$
1,800,000
$
2,100,000
$
2,400,000
Cost of goods sold
450,000
530,000
600,000
650,000
Administrative costs
350,000
205,000
210,000
220,000
Advertising costs
0
180,000
0
0
Executive bonuses
0
0
0
92,000
Provision for bad debts
0
0
0
72,000
Annual maintenance costs
80,000
0
0
0
Additional Information
First-quarter administrative costs include the $200,000...
Noventis Corporation prepared the following estimates for the four quarters of the current year: First Quarter...
Noventis Corporation prepared the following estimates for the
four quarters of the current year:
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter
Sales
$
1,150,000
$
1,380,000
$
1,610,000
$
1,840,000
Cost of goods sold
415,000
495,000
565,000
615,000
Administrative costs
280,000
170,000
175,000
185,000
Advertising costs
0
160,000
0
0
Executive bonuses
0
0
0
64,000
Provision for bad debts
0
0
0
58,000
Annual maintenance costs
66,000
0
0
0
Additional Information
First-quarter administrative costs include the $130,000...
Noventis Corporation prepared the following estimates for the four quarters of the current year: First Quarter...
Noventis Corporation prepared the following estimates for the
four quarters of the current year:
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter
Sales
$
1,150,000
$
1,380,000
$
1,610,000
$
1,840,000
Cost of goods sold
415,000
495,000
565,000
615,000
Administrative costs
280,000
170,000
175,000
185,000
Advertising costs
0
160,000
0
0
Executive bonuses
0
0
0
64,000
Provision for bad debts
0
0
0
58,000
Annual maintenance costs
66,000
0
0
0
Additional Information
First-quarter administrative costs include the $130,000...
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