Question

]

Exercise 23-6

On January 1, 2017, the Hardin Company budget committee has reached agreement on the following data for the 6 months ending June 30, 2017.

Sales units: First quarter 5,700; second quarter 6,200; third quarter 7,200
Ending raw materials inventory: 40% of the next quarter’s production requirements
Ending finished goods inventory: 25% of the next quarter’s expected sales units
Third-quarter production: 7,670 units.

The ending raw materials and finished goods inventories at December 31, 2016, follow the same percentage relationships to production and sales that occur in 2017. 4 pounds of raw materials are required to make each unit of finished goods. Raw materials purchased are expected to cost $4 per pound.

Prepare a production budget by quarters for the 6-month period ended June 30, 2017.

HARDIN COMPANY
Production Budget

June 30, 2017
For the Quarter Ending June 30, 2017
For the Six Months Ending June 30, 2017
Quarter
1
2
Six Months

Total Materials Required
Direct Materials Per Unit
Expected Unit Sales
Total Required Units
Desired Ending Direct Materials
Beginning Finished Goods Unit
Desired Ending Finished Goods Unit
Beginning Direct Materials
Direct Materials Purchases
Required Production Units

Add
Less
:

Beginning Direct Materials
Expected Unit Sales
Total Materials Required
Desired Ending Finished Goods Unit
Required Production Units
Beginning Finished Goods Unit
Total Required Units
Desired Ending Direct Materials
Direct Materials Per Unit
Direct Materials Purchases

Beginning Direct Materials
Total Materials Required
Desired Ending Finished Goods Unit
Direct Materials Per Unit
Direct Materials Purchases
Expected Unit Sales
Required Production Units
Total Required Units
Beginning Finished Goods Unit
Desired Ending Direct Materials

Add
Less
:

Direct Materials Per Unit
Required Production Units
Desired Ending Finished Goods Unit
Direct Materials Purchases
Expected Unit Sales
Total Materials Required
Beginning Direct Materials
Total Required Units
Beginning Finished Goods Unit
Desired Ending Direct Materials

Total Required Units
Total Materials Required
Desired Ending Direct Materials
Required Production Units
Direct Materials Per Unit
Direct Materials Purchases
Expected Unit Sales
Desired Ending Finished Goods Unit
Beginning Finished Goods Unit
Beginning Direct Materials

LINK TO TEXT

Prepare a direct materials budget by quarters for the 6-month period ended June 30, 2017.

HARDIN COMPANY
Direct Materials Budget

For the Quarter Ending June 30, 2017
For the Six Months Ending June 30, 2017
June 30, 2017
Quarter
1
2
Six Months

Direct Labor Time Per Unit
Beginning Direct Materials
Units to be Produced
Total Direct Labor Cost
Cost Per Pound
Desired Ending Direct Materials
Total Materials Required
Direct Labor Cost Per Hour
Direct Materials Purchases
Direct Materials Per Unit
Total Required Direct Labor Hours
Total Cost of Direct Materials Purchases
Total Pounds Needed for Production

Desired Ending Direct Materials
Units to be Produced
Direct Materials Purchases
Total Materials Required
Cost Per Pound
Direct Materials Per Unit
Total Required Direct Labor Hours
Beginning Direct Materials
Direct Labor Time Per Unit
Total Cost of Direct Materials Purchases
Direct Labor Cost Per Hour
Total Direct Labor Cost
Total Pounds Needed for Production

Direct Materials Purchases
Direct Labor Cost Per Hour
Total Pounds Needed for Production
Cost Per Pound
Units to be Produced
Beginning Direct Materials
Direct Materials Per Unit
Direct Labor Time Per Unit
Total Direct Labor Cost
Total Cost of Direct Materials Purchases
Total Materials Required
Total Required Direct Labor Hours
Desired Ending Direct Materials

Add
Less
:

Beginning Direct Materials
Cost Per Pound
Total Direct Labor Cost
Direct Materials Purchases
Total Cost of Direct Materials Purchases
Direct Labor Cost Per Hour
Direct Materials Per Unit
Total Required Direct Labor Hours
Units to be Produced
Desired Ending Direct Materials
Total Materials Required
Total Pounds Needed for Production
Direct Labor Time Per Unit

Total Materials Required
Cost Per Pound
Total Pounds Needed for Production
Total Required Direct Labor Hours
Direct Labor Cost Per Hour
Direct Materials Purchases
Desired Ending Direct Materials
Direct Labor Time Per Unit
Direct Materials Per Unit
Units to be Produced
Beginning Direct Materials
Total Cost of Direct Materials Purchases
Total Direct Labor Cost

Add
Less
:

Direct Labor Time Per Unit
Units to be Produced
Total Materials Required
Direct Materials Purchases
Direct Materials Per Unit
Total Direct Labor Cost
Total Cost of Direct Materials Purchases
Total Pounds Needed for Production
Beginning Direct Materials
Total Required Direct Labor Hours
Cost Per Pound
Desired Ending Direct Materials
Direct Labor Cost Per Hour

Beginning Direct Materials
Total Pounds Needed for Production
Total Required Direct Labor Hours
Units to be Produced
Cost Per Pound
Total Materials Required
Desired Ending Direct Materials
Direct Labor Cost Per Hour
Direct Materials Purchases
Direct Materials Per Unit
Direct Labor Time Per Unit
Total Cost of Direct Materials Purchases
Total Direct Labor Cost

Beginning Direct Materials
Total Materials Required
Cost Per Pound
Direct Labor Time Per Unit
Direct Materials Purchases
Desired Ending Direct Materials
Direct Materials Per Unit
Direct Labor Cost Per Hour
Total Cost of Direct Materials Purchases
Total Direct Labor Cost
Total Pounds Needed for Production
Total Required Direct Labor Hours
Units to be Produced
$
$

Total Materials Required
Direct Materials Purchases
Direct Labor Cost Per Hour
Total Cost of Direct Materials Purchases
Desired Ending Direct Materials
Beginning Direct Materials
Total Direct Labor Cost
Direct Materials Per Unit
Total Pounds Needed for Production
Total Required Direct Labor Hours
Units to be Produced
Cost Per Pound
Direct Labor Time Per Unit
$
$
$

LINK TO TEXT

Question Attempts: Unlimited
SAVE FOR LATER
SUBMIT ANSWER

Answer 1

• All working forms part of the answer
• YOU have ONLY asked for PRODUCTION BUDGET & DIRECT MATERIAL BUDGET
• Production Budget

Production Budget
For the Six Months Ending June 30, 2017
	Quarter 1	Quarter 2	Six Months
Expected Unit Sales	5,700	6,200	11,900
Add: Desired Ending Finished Goods Unit	1,550	1,800	1,800
Total Required Units	7,250	8,000	13,700
Less: Beginning Finished Goods Unit	1,425	1,550	1,425
Required Production Units	5,825	6,450	12,275

• Working

Production Budget
For the Six Months Ending June 30, 2017
	Quarter 1	Quarter 2	Six Months
Expected Unit Sales	5700	6200	=5700+6200
Add: Desired Ending Finished Goods Unit	=6200 units x 25%	=7200 units x 25%	1800
Total Required Units	=5700+1550	=6200+1800	=11900+1800
Less: Beginning Finished Goods Unit	=5700 units x 25%	=6200 units x 25%	1425
Required Production Units	=7250-1425	=8000-1550	=13700-1425

• Direct Material Budget

	Direct Materials Budget
	For the Six Months Ending June 30, 2017
		Quarter 1	Quarter 2	Six Months
A	Units to be Produced	5,825	6,450	12,275
B	Direct Materials Per Unit	4	4	4
C = A x B	Total Pounds Needed for Production	23,300	25,800	49,100
D	Add: Desired Ending Direct Materials	10,320	12,272	12,272
E = C+D	Total Materials Required	33,620	38,072	61,372
F	Less: Beginning Direct Materials	9,320	10,320	9,320
G =E - F	Direct Materials Purchases	24,300	27,752	52,052
H	Cost Per Pound	$                       4.00	$                     4.00	$                     4.00
I = G x F	Total Cost of Direct Materials Purchases	$            97,200.00	$        111,008.00	$        208,208.00