Question

Shadee Corp. expects to sell 590 sun visors in May and 430 in June. Each visor sells for $25. Shadee’s beginning and ending finished goods inventories for May are 80 and 45 units, respectively. Ending finished goods inventory for June will be 70 units

E8-6 Preparing Raw Materials Purchases and Manufacturing Overhead Budgets [LO 8-3c, e]

Each visor requires a total of $3.50 in direct materials that includes an adjustable closure that the company purchases from a supplier at a cost of $2.50 each. Shadee wants to have 29 closures on hand on May 1, 18 closures on May 31, and 27 closures on June 30. Additionally, Shadee’s fixed manufacturing overhead is $900 per month, and variable manufacturing overhead is $2.25 per unit produced.

Required:
1. Determine Shadee's budgeted cost of closures purchased for May and June. (Round your answers to 2 decimal places.)

	May June Budgeted Cost of Closures Purchased

2. Determine Shadee's budget manufacturing overhead for May and June. (Do not round your intermediate values. Round your answers to 2 decimal places.)

	May June Budgeted Manufacturing Overhead

E8-7 Preparing Direct Labor Budget [LO 8-3d]

Suppose that each visor takes 0.80 direct labor hours to produce and Shadee pays its workers $12 per hour.

Required:
Determine Shadee's budgeted direct labor cost for May and June. (Do not round your intermediate values. Round your answers to 2 decimal places.)

	May June Budgeted Direct Labor Cost

Answer 1

working
Production Budget
	May	June
expected sales in units	590	430
Add Desired Ending Inventory	45	70
Total Needs	635	500
Less Beginning Inventory	80	45
Budgeted production in units	555	455
answers
	May	June
Budgeted cost of raw material purchases
Budgeted production in units	555	455
Total required	555	455
Add Desired Ending Inventory	18	27
Total Needs	573	482
Less Beginning Inventory	29	18
ans 1
Budgeted cost of Closures purchases	$544.00	464.00
ans 2
Budgeted Manufacturing overhead
Budgeted production in units	555	455
Variable overhead per unit	2.25	2.25
Total variable overhead	1248.75	1023.75
Add: fixed manufacturing overhead	900	900
Budgeted Manufacturing overhead	2148.75	1923.75
Direct labor rate   not clear	May	June
Budgeted production in units	555	455
Time required	0.8	0.8
Direct labor hours required D	444	364
Labor rate (not clear) L	12	12
Ans 3 Budgeted Direct labor cost D*L	5328	4368
If any dooubt please comment