A company expects to sell 6,000 units in April and expects sales to increase 20% each...

A company expects to sell 6,000 units in April and expects sales to increase 20% each month after. The unit sales price of $8 is expected to remain constant. The company wants ending finished goods inventory to be 15% of the next month’s sales.

What are budgeted sales revenues for the second quarter?

How many units will be produced in the second quarter? Round answers to nearest whole number.

The raw materials ending inventory should be 20% of the next month’s production needs. Assuming each unit requires 4 feet of material that costs $3 per foot, what is the cost of May purchases?

Monthly manufacturing overhead is budgeted to be $15,000 per month plus $8 per unit produced. What is budgeted manufacturing overhead for May?

If each unit required 0.75 hours of labor, and the labor wage is $9/hr, what is budgeted DL cost for May?

Expert Solution

1)		April	May	June	Total	July
	Budgeted Sales Unit	6000	7200	8640	21840	10368
	Unit Price	8	8	8
	Budgeted Sales Revenue	48000	57600	69120	*174720*

	Final Answer $174720

		April	May	June	Total	July	Aug
2)	Total Units to be sold	6,000	7,200	8,640	21,840	10368	12,442
	Add: Ending Inventory Required	1,080	1,296	1,555		1,866
	Less: beginning Inventory Available	-	1,080	1,296		1,555
	Units to be produced	7,080	7,416	8,899	*23,395*	10,679

	Final Answer 23395 Units


3)		April	May	June	July
	Total Units to be produced	7,080	7,416	8,899	10,679
	Requirement per unit	4	4	4	4
	Raw material units required	28,320	29,664	35,597	42,716
	Add: Ending Inventory Required	5,933	7,119	8,543
	Less: beginning Inventory Available	-	5,933	7,119	8,543
	Units to be produced	13,013	8,603	10,323
	Cost per unit	3	3	3	3
	Cost of purchase	39,038	25,808	30,969	-

	Final Answer (may cost of purchase) $25808

4)		April	May	June
	Total Units to be produced	7,080	7,416	8,899
	Variable manufacturing OH per unit	8	8	8
	Variable manufacturing OH	56,640	59,328	71,194
	Fixed manufacaturing OH	15,000	15,000	15,000
	Total manufacturing OH	71,640	74,328	86,194

	Final Answer (may overhead) $74328

5)		April	May	June
	Total Units to be produced	7,080	7,416	8,899
	labour hr per unit	0.75	0.75	0.75
	labour hr required	5,310	5,562	6,674
	labour cost per hr	9	9	9
	labour cost	47,790	50,058	60,070

	Final Answer (may labor cost) $50058

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