MALNBREWERCH7.1 - Paid in the current month Mfg Overhead...

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Royal Company Ltd. Example for CH 7 Sales forecast April May June July 20,000units 50,000 units 30,000 units 25,000 units Unit selling price $10 Collections:-70% in month of sale, 25% in the following month, 5% uncollectible. Accounts Receivable March 31 $30,000 all collectible Finished Goods Inventory policy—ending inventory to be 20% of the following month’s unit sales. Inventory March 31, 4,000 units Direct Materials 5kg per unit, $0.40 per unit Ending inventory to be 10% of following month’s production Needs Payments: 50% in current month, 50% the following month No discounts in effect. Accounts Payable March 31 $12,000 Direct Labour 0.05 dlh per unit, $10.00 per hour
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Unformatted text preview: Paid in the current month Mfg Overhead Variable $20 per dlh, fixed $50,500 including $20,500 Amortization Paid in the current month Cost of Goods DM 5KG@.40 $2.00 Manufactured DL .05LH@10 .50 MOH .O5@50 2.50 $5.00 Selling & Variable,$.50 per unit sold, fixed $70,000 including $10,000 Administration amortization Paid in the current month Cash Can borrow up to $75,000 Borrow at beginning of month, repay at end, interest 16% Ending balance to be a minimum of $30,000 Balance March 31 $40,000 Cash dividends paid in April, $51,000 Equipment purchases, April $143,700, May $48,800...
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