In: Accounting
[The following information applies to the questions displayed
below.]
Shadee Corp. expects to sell 540 sun visors in May and 350 in June.
Each visor sells for $24. Shadee’s beginning and ending finished
goods inventories for May are 80 and 45 units, respectively. Ending
finished goods inventory for June will be 50 units.
Each visor requires a total of $5.00 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, 16 closures on May 31, and 21 closures on June
30. Additionally, Shadee’s fixed manufacturing overhead is $1,100
per month, and variable manufacturing overhead is $2.75 per unit
produced.
1. Determine Shadee's budgeted cost of closures
purchased for May and June. (Round your answers to 2
decimal places.)
2. Determine Shadee's budget manufacturing
overhead for May and June. (Do not round your intermediate
values. Round your answers to 2 decimal places.)
3. Suppose that each visor takes 0.80 direct
labor hours to produce and Shadee pays its workers $7 per
hour.
Determine Shadee's budgeted direct labor cost for May and June.
(Do not round your intermediate values. Round your answers
to 2 decimal places.)