Question
In: Accounting
Sales are expected to increase by 10% per month. January sales are expected to be 110,000...
Sales are expected to increase by 10% per month. January sales are expected to be 110,000 units We want an ending finished goods inventory balance each month of 10% of the current month’s sales Each unit sells for $85 Each unit required 2 pounds of raw material A, and 5 grams of raw material B. Raw material A costs $11 per pound and raw material B costs $1 per gram. We want an ending raw materials inventory of 20% of the current month’s production requirement Each unit requires 10 minutes of direct labor at $17 per hour Manufacturing overhead is based on direct labor hours at $5 per hour A sales commission of $2 is paid on each unit sold. The Sales and Administrative office employs staff with salaries and wages expense of $150,000 per year, occupies a building with property tax expense of $9,600 per year and $12,000 per year in depreciation expense. Prepare the following budgets for January, February, and March: • Sales Budget • Production Budget • Direct Materials Budget • Direct Labor Budget • Manufacturing Overhead Budget • Selling and Administrative Budget
Solutions
Expert Solution
| Sollution 1 | ||||||
| Sales Budget | ||||||
| Particulars | January | February | March | |||
| Sales units | 110000 | 121000 | 133100 | |||
| Selling price per unit | $85.00 | $85.00 | $85.00 | |||
| Budgeted Sales Revenue | $9,350,000 | $10,285,000 | $11,313,500 | |||
| Solution 2 | ||||||
| Production Budget | ||||||
| Particulars | January | February | March | |||
| Sales units | 110000 | 121000 | 133100 | |||
| Add: Desired ending inventory 10% of Current month sales) | 11000 | 12100 | 13310 | |||
| Less: Opening Inventory | 0 | 11000 | 12100 | |||
| Nos of unit to be produced | 121000 | 122100 | 134310 | |||
| Solution 3 | ||||||
| Raw Material Purchase Cost Budget | ||||||
| Particulars | January | February | March | |||
| Unit to Produce | 121000 | 122100 | 134310 | |||
| Material -A (Pound) | Material -B (Grams ) | Material -A (Pound) | Material -B (Grams ) | Material -A (Pound) | Material -B (Grams ) | |
| Raw material needed per unit | 2 | 5 | 2 | 5 | 2 | 5 |
| Raw material needed for unit to produce | 242000 | 605000 | 244200 | 610500 | 268620 | 671550 |
| Add: Desired units of material in ending inventory (20% of Current month production) | 48400 | 121000 | 48840 | 122100 | 53724 | 134310 |
| Less: units of material in beginning inventory | 0 | 0 | 48400 | 121000 | 48840 | 122100 |
| Total Units of Raw material to purchased | 290400 | 726000 | 244640 | 611600 | 273504 | 683760 |
| unit cost of Raw material | $11.00 | $1.00 | $11.00 | $1.00 | $11.00 | $1.00 |
| Cost of raw material to be purchased | $3,194,400 | $726,000 | $2,691,040 | $611,600 | $3,008,544 | $683,760 |
| Sollution 4 | |||
| Budgeted labor cost budget | |||
| Particulars | January | February | March |
| Budgeted Production units | 121000 | 122100 | 134310 |
| Direct labor hours per unit(10 minutes /60minutes) | 0.167 | 0.1667 | 0.1667 |
| Budgeted direct labor hours | 20171 | 20350 | 22385 |
| direct labor cost per hour | $17 | $17 | $17 |
| Budgeted direct labor cost | $342,902 | $345,950 | $380,545 |
| Sollution 5 | |||
| Budgeted Manufacturing Overhead Budget | |||
| Particulars | January | February | March |
| Budgeted Production units | 121000 | 122100 | 134310 |
| Direct labor hours per unit(10 minutes /60minutes) | 0.167 | 0.1667 | 0.1667 |
| Budgeted direct labor hours | 20171 | 20350 | 22385 |
| Manufacturing Overhead Per Labour Hours | $5 | $5 | $5 |
| Budgeted Manufacturing Overhead Budget | $100,854 | $101,750 | $111,925 |
| Sollution 6 | |||
| Budgeted Selling and Administrative Budget | |||
| Particulars | January | February | March |
| Sale Unit | 110000 | 121000 | 133100 |
| sales commission(@2 Per Unit Sold ) | $ 220,000 | $ 242,000 |
 ekkarill92 answered 2 years agoRelated SolutionsSales are expected to increase by 10% per month. January sales are expected to be 110,000...Sales are expected to increase by 10% per month. January sales
are expected to be 110,000 units We want an ending finished goods
inventory balance each month of 10% of the current month’s sales
Each unit sells for $85 Each unit required 2 pounds of raw material
A, and 5 grams of raw material B. Raw material A costs $11 per
pound and raw material B costs $1 per gram. We want an ending raw
materials inventory of 20% of...
Based on the current sales mix, if total sales increase by $30,000 per month, by how much will the overall company’s operating income increase?The Tigers Company sells two products
with the following data:
Product A
Sales
...............................................$100,000
Product B
$100,000
Total
$200,000
Variable
costs.................................... 70,000
55,000
125,000
Contribution
margin.........................$ 30,000
$ 45,000
$ 75,000
Contribution margin
ratio
30%
45%
37.5%
The company’s fixed expenses total
$45,000 per month.
2. Based on the current sales mix, the breakeven point for the
company as a whole is
A. $200,000
B.
$175,000
C.
$120,000
D.
$150,000
2. Based on the current sales mix, if total sales...
Month Actual Sales Forecast Sales January 8 10 February 11 10 March 12 10 April 14...
Month
Actual Sales
Forecast Sales
January
8
10
February
11
10
March
12
10
April
14
10
-Compute the RSFE, MAD and tracking signals for months January
to April?
Month Cash disbursement Cash receipts January 100,000 100,000 February 110,000 90,000 March 110,000 80,000 April 150,000...
Month
Cash disbursement
Cash receipts
January
100,000
100,000
February
110,000
90,000
March
110,000
80,000
April
150,000
100,000
May
180,000
120,000
June
180,000
160,000
July
180,000
200,000
August
180,00
250,000
September
150,000
250,000
October
110,000
200,000
November
100,000
140,000
December
100,000
100,000
Below table shows the monthly estimates of cash disbursement and
receipts from January to December 2019 for preparing the cash
budgets for Bintang Sdn Bhd. Bintang Sdn Bhd has beginning cash on
hand of RM10,000 and the company wishes...
SALES PER MONTH DURING THE LAST YEAR 20X1 JANUARY $ 550,000 FEBRUARY $ 825,000 MARCH $...SALES PER MONTH DURING THE LAST YEAR 20X1
JANUARY $ 550,000 FEBRUARY $ 825,000 MARCH $ 575,000
APRIL $ 870,000 MAY $ 1,080,000 JUNE $ 1,065,000
JULY $ 1,070,000 AUGUST $ 1,060,000 SEPTEMBER $ 1,180,000
OCTOBER $ 1,140,000 NOVEMBER $ 1,290,000 DECEMBER $ 1,460,000
I. Sales Projection: 20X2
After consulting the Company's Management Committee, it was agreed
that business plans and strategies were deemed appropriate, a 35%
increase in sales reported during the months of last year 20x1. All
sales...
How much will net operating income increase (decrease) per month if the company uses higher-quality components that increase the variable expense by $4 per unit and increase unit sales by 20%Data for Hermann Corporation are shown below:Per UnitPercent of SalesSelling price$80100%Variable expenses4455Contribution margin$3645%Fixed expenses are $76,000 per month and the company is selling
2,500 units per month.2-a. How much will net operating income increase (decrease) per
month if the company uses higher-quality components that increase
the variable expense by $4 per unit and increase unit sales by
20%.2-b. Should the higher-quality components be used?
How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $5,000 and monthly sales increase by $9,000?Data for Hermann Corporation are shown below
Per
Unit
Percent of SalesSelling Price
$90
100%Variable
Expenses
63
70Contribution margin
$27
30%Fixed expenses are $30,000 per month and the company is selling
2,000 units per month.1. How much will net
operating income increase (decrease) per month if the monthly
advertising budget increases by $5,000 and monthly sales increase
by $9,000?2. Refer to the original
data. How much will net operating income increase (decrease) per
month if the company uses higher- quality...
How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $9,900 and monthly sales increase by $24,500?
Data for Hermann Corporation are shown below:
Per Unit
Percent of Sales
Selling price
$
75
100
%
Variable expenses
51
68
Contribution margin
$
24
32
%
Fixed expenses are $75,000 per month and the company is selling 4,000 units per month.
Required:
How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $9,900 and monthly sales...
XYZ stock has an expected ROE of 10%per year， expected earnings per share of$5， and expected...
XYZ stock has an expected ROE of 10%per year， expected earnings
per share of$5， and
expected dividends of$2per share.Its
market capitalization rate is 12%per year.
a. What are the firm's price and price-earnings ratio?(10%)
b.If the firm increases its plow back
ratio to 0.8， what would be its price and price-
earnings ratio?(5%)
Compare the results of(a) and(b) to explain the effect of the
plow back ratio on the price-earnings ratio.
A stock is expected to pay a dividend of$1 per share in 3-month and in 9-month....A stock is expected to pay a dividend of$1 per share in 3-month
and in 9-month. The stock price is$80. An investor has just taken a
long position in a 12-month futures contract on the stock. The zero
ratesfor 3-, 6-, 9-, 12-month are 5%, 5.5%, 6% and 6.5% per annum
with continuous compounding, respectively.6-month later, the stock
price is$82. The zero rates happen to be the implied forward rates
6-month ago.What is the value of the long position in...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
ADVERTISEMENT
|