Question
In: Accounting
Krause Company manufactures drinking glasses. One unit is a package of eight glasses, which sells for...
Krause Company manufactures drinking glasses. One unit is a package of eight glasses, which sells for $28. Krause projects sales for April will be 3,000 packages, with sales increasing by 550 packages per month for May, June, and July. On April 1, Krause has 325 packages on hand but desires to maintain an ending inventory of 20% of the next month’s sales. Prepare a sales budget and a production budget for Krause for April, May and June
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Krause Company |
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Budget Production April, May, and June |
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April |
May |
June |
Total |
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Budgeted packages to be sold |
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Plus: Desired packages in ending inventory |
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Total packages needed |
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Less: Packages in beginning inventory |
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Budgeted packages to be produced |
Solutions
ekkarill92 answered 2 years agoRelated Solutions
Glass company manufactures glasses that it sells to mail-order distributors.  
Glass company manufactures glasses that it sells to mail-order
distributors.
Sales price per pair of
glasses:
$58
Manufacturing and other costs
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Variable Cost per
unit
Direct
Materials
$11
Direct
labor
10
Factory
overhead
2
Variable distribution costs are for transportation to mail-order
distributors
3
Total Variable
costs
$26
Fixed costs per
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Factory
overhead
$20,000
Selling and
Administrative
10,000
Total Fixed
costs
$30,000
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Per Unit
Direct materials
$
8.00
Direct labor
$
5.00
Variable manufacturing overhead
$
1.00
Fixed manufacturing overhead
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3.50
Fixed administrative expense
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Assume that a company manufactures and sells a variety of
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Sales
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500,000
Variable expenses:
Variable manufacturing expenses
$
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Sales commissions
75,000
Shipping
25,000
Total variable expenses
340,000
Contribution margin
160,000
Fixed expenses:
Salary of product-line manager
$
65,000
Advertising for this product
35,000
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Direct material (3.0 kg at €2 per kg)
6.00
Direct labour (1.2 hours at €10 per hour)
12.00
Manufacturing overheads
7.00
25.00
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24,000 kg of material
56,500
10,950 hours of
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228,900
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runs...
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