Question

Detmer Enterprises has the following budgeted sales:

                  Budgeted Sales in Units
June                   6,800 units
July                   5,100 units
August                 4,400 units
September              3,700 units

Past experience has shown that the ending finished goods inventory for
each month should be equal to 25% of the next month's expected sales in
units. Additionally, it is known that every unit produced requires four
direct labor hours to make and direct laborers are paid $15 per hour.

Assume that Detmer pays 65% of its direct labor in the same month the
employee works, pays 30% of its direct labor in the month after the
employee works, and the final 5% is paid two months after the employee
works.

Calculate Detmer Enterprises' budgeted salaries payable at August 31.

Answer 1

Detmer enterprises budgeted salary payable is $103,500

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