Question

In: Accounting

Question # 3 — Production and Direct Materials Budgets Walsh Company has budgeted the following unit...

Question # 3 — Production and Direct Materials Budgets
Walsh Company has budgeted the following unit sales for the first quarter of 2017:
Units
January 36,000
February 54,000
March 45,000

It takes two pounds of direct materials, which cost $6 per pound, to manufacture one unit of product. It is the company's policy to have a finished goods inventory on hand at the end of each month equal to 20% of next month's sales and to maintain a direct materials inventory at the end of the month equal to 30% of the next month's production needs. The inventory levels at December 31, 2016, were in accordance with company policy.

Instructions: Answer the following independent questions and show computations which support your answers.

1. What was the number of units in ending finished goods inventory at December 31, 2016?


2. Calculate the number of units that should be scheduled for production in the month of February.




3. What was the number of units in ending direct materials inventory at December 31, 2016?



4. What was the number of units and the dollar amount of direct materials purchases budgeted for the month of January?

Solutions

Expert Solution


Related Solutions

Question # 3 — Production and Direct Materials Budgets Walsh Company has budgeted the following unit...
Question # 3 — Production and Direct Materials Budgets Walsh Company has budgeted the following unit sales for the first quarter of 2017: Units January 36,000 February 54,000 March 45,000 It takes two pounds of direct materials, which cost $6 per pound, to manufacture one unit of product. It is the company's policy to have a finished goods inventory on hand at the end of each month equal to 20% of next month's sales and to maintain a direct materials...
Production, Direct Labor, Direct Materials, Sales Budgets, Budgeted Contribution Margin Greiner Company makes and sells high-quality...
Production, Direct Labor, Direct Materials, Sales Budgets, Budgeted Contribution Margin Greiner Company makes and sells high-quality glare filters for microcomputer monitors. John Craven, controller, is responsible for preparing Greiner’s master budget and has assembled the following data for the coming year. The direct labor rate includes wages, all employee-related benefits, and the employer’s share of FICA. Labor saving machinery will be fully operational by March. Also, as of March 1, the company’s union contract calls for an increase in direct...
Production, Direct Labor, Direct Materials, Sales Budgets, Budgeted Contribution Margin Greiner Company makes and sells high-quality...
Production, Direct Labor, Direct Materials, Sales Budgets, Budgeted Contribution Margin Greiner Company makes and sells high-quality glare filters for microcomputer monitors. John Craven, controller, is responsible for preparing Greiner’s master budget and has assembled the following data for the coming year. The direct labor rate includes wages, all employee-related benefits, and the employer’s share of FICA. Labor saving machinery will be fully operational by March. Also, as of March 1, the company’s union contract calls for an increase in direct...
Production, Direct Labor, Direct Materials, Sales Budgets, Budgeted Contribution Margin Greiner Company makes and sells high-quality...
Production, Direct Labor, Direct Materials, Sales Budgets, Budgeted Contribution Margin Greiner Company makes and sells high-quality glare filters for microcomputer monitors. John Craven, controller, is responsible for preparing Greiner’s master budget and has assembled the following data for the coming year. The direct labor rate includes wages, all employee-related benefits, and the employer’s share of FICA. Labor saving machinery will be fully operational by March. Also, as of March 1, the company’s union contract calls for an increase in direct...
Kristopher Company has budgeted sales of $300,000 with the following budgeted costs:       Direct materials                    &nb
Kristopher Company has budgeted sales of $300,000 with the following budgeted costs:       Direct materials                                       $60,000       Direct manufacturing labor                       40,000       Factory overhead             Variable                                               30,000             Fixed                                                    50,000       Selling and administrative expenses             Variable                                               20,000             Fixed                                                    30,000       Required (10 points):             Compute the average markup percentage for setting prices as a percentage of:                         The full cost of the product The variable cost of the product Variable manufacturing costs Total manufacturing costs
Prepare the sales, production, and direct materials budgets by quarters for 2017.
Pargo Company is preparing its master budget for 2017. Relevant data pertaining to its sales, production, and direct materials budgets are as follows.Sales. Sales for the year are expected to total 1,100,000 units. Quarterly sales are 22%, 27%, 26%, and 25%, respectively. The sales price is expected to be $38 per unit for the first three quarters and $45 per unit beginning in the fourth quarter. Sales in the first quarter of 2018 are expected to be 15% higher than...
Timbuk 3 Company has the following information for March: Cost of direct materials used in production $21,000 Direct labor 54,250
Timbuk 3 Company has the following information for March:Cost of direct materials used in production $21,000Direct labor 54,250Factory overhead 35,000Work in process inventory, March 1 87,500Work in process inventory, March 31 92,750Finished goods inventory, March 1 36,750Finished goods inventory, March 31 42,000For March,Determine (a) the cost of goods manufactured and (b) the cost of goods sold   
Problem 8-30 Integration of the Sales, Production, and Direct Materials Budgets [LO8-2, LO8-3, LO8-4] Milo Company...
Problem 8-30 Integration of the Sales, Production, and Direct Materials Budgets [LO8-2, LO8-3, LO8-4] Milo Company manufactures beach umbrellas. The company is preparing detailed budgets for the third quarter and has assembled the following information to assist in the budget preparation: The Marketing Department has estimated sales as follows for the remainder of the year (in units): July 35,000 October 25,000 August 80,000 November 11,500 September 49,000 December 12,000 The selling price of the beach umbrellas is $13 per unit....
Problem 8-30 Integration of the Sales, Production, and Direct Materials Budgets [LO8-2, LO8-3, LO8-4] Milo Company...
Problem 8-30 Integration of the Sales, Production, and Direct Materials Budgets [LO8-2, LO8-3, LO8-4] Milo Company manufactures beach umbrellas. The company is preparing detailed budgets for the third quarter and has assembled the following information to assist in the budget preparation: The Marketing Department has estimated sales as follows for the remainder of the year (in units): July 37,000 October 27,000 August 84,000 November 13,500 September 53,000 December 14,000 The selling price of the beach umbrellas is $11 per unit....
Problem 8-30 Integration of the Sales, Production, and Direct Materials Budgets [LO8-2, LO8-3, LO8-4] Milo Company...
Problem 8-30 Integration of the Sales, Production, and Direct Materials Budgets [LO8-2, LO8-3, LO8-4] Milo Company manufactures beach umbrellas. The company is preparing detailed budgets for the third quarter and has assembled the following information to assist in the budget preparation: The Marketing Department has estimated sales as follows for the remainder of the year (in units): July 42,500 October 32,500 August 95,000 November 19,000 September 64,000 December 19,500 The selling price of the beach umbrellas is $10 per unit....
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT