Question

Problem 21-2A (Part Level Submission)

Deleon Inc. is preparing its annual budgets for the year ending December 31, 2017. Accounting assistants furnish the data shown below.

		Product JB 50		Product JB 60
Sales budget:
Anticipated volume in units		402,300		203,700
Unit selling price		$23		$27
Production budget:
Desired ending finished goods units		28,100		18,100
Beginning finished goods units		34,100		12,500
Direct materials budget:
Direct materials per unit (pounds)		1		3
Desired ending direct materials pounds		34,000		18,500
Beginning direct materials pounds		44,600		13,400
Cost per pound		$3		$3
Direct labor budget:
Direct labor time per unit		0.4		0.6
Direct labor rate per hour		$12		$12
Budgeted income statement:
Total unit cost		$14		$22

An accounting assistant has prepared the detailed manufacturing overhead budget and the selling and administrative expense budget. The latter shows selling expenses of $661,000 for product JB 50 and $361,000 for product JB 60, and administrative expenses of $545,000 for product JB 50 and $344,000 for product JB 60. Interest expense is $150,000 (not allocated to products). Income taxes are expected to be 30%.

Prepare the production budget for the year.

DELEON INC.
Production Budget

JB 50
JB 60

402,300

203,700
:

18,500

18,100

:

Answer 1

Production Budget
For the Year Ended Dec 31, 2017
	JB 50	JB 60	Total
Sales In Units	402,300	203,700
Add: Closing Inventory in Units	28,100	18,100
Total Needs	430,400	221,800
Less: opening Inventory in Units	(34,100)	(12,500)
Required Production in Units	396,300	209,300	605,600