Production budget for the month of april product cat

This preview shows 21 out of 25 pages.

Production Budget For the Month of April Product Cat-allac Dog-eriffic Budgeted unit sales 500 300 Add target ending finished goods inventory 35 15 Total required units 535 315 Deduct beginning finished goods inventory 15 30 Units of finished goods to be produced 520 285 3a. Direct Material Usage Budget in Quantity and Dollars For the Month of April Material Plastic Metal Total Physical Units Budget Direct materials required for Cat-allac (520 units × 4 lbs. and 0.5 lb.) 2,080 lbs. 260 lbs. Dog-errific (285 units × 6 lbs. and 1 lb.) 1,710 lbs. 285 lbs. Total quantity of direct material to be used 3,790 lbs. 545 lbs. Cost Budget Available from beginning direct materials inventory (under a FIFO cost-flow assumption) Plastic: 250 lbs. × $3.80 per lb. $ 950 Metal: 60 lbs. × $3 per lb. $ 180 To be purchased this period . Plastic: (3,790 – 250) lbs. $4 per lb. 14,160 Metal: (545 – 60) lbs. $3 per lb. __ ____ 1,455 Direct materials to be used this period $15,110 $ 1,635 $16,745 6-21
Image of page 21

Subscribe to view the full document.

Direct Material Purchases Budget For the Month of April Material Plastic Metal Total Physical Units Budget To be used in production (requirement 3) 3,790 lbs. 545 lbs. Add target ending inventory 380 lbs. 55 lbs. Total requirements 4,170 lbs. 600 lbs. Deduct beginning inventory 250 lbs. 60 lbs. Purchases to be made 3,920 lbs. 540 lbs. Cost Budget Plastic: 3,920 lbs. $4 $15,680 Metal: 540 lbs. $3 ______ $ 1,620 Purchases $15,680 $ 1,620 $ 17,300 4. Direct Manufacturing Labor Costs Budget For the Month of April Output Units Produced DMLH Total Hourly Wage (requirement 2) per Unit Hours Rate Total Cat-allac 520 3 1,560 $10 $15,600 Dog-errific 285 5 1,425 10 14,250 Total $29,850 5. Machine Setup Overhead Cat-allac Dog-errific Total Units to be produced 520 285 Units per batch ÷ 20 ÷15 Number of batches 26 19 Setup time per batch 1.5 hrs. 1.75 hrs. Total setup time 39 hrs. 33.25 hrs. 72.25 hrs. Budgeted machine setup costs = $100 per setup hour 72.25 hours = $7,225 Processing Overhead Budgeted machine-hours (MH) = (10 MH per unit × 520 units) + (18 MH per unit × 285 units) = 5,200 MH + 5,130 MH = 10,330 MH Budgeted processing costs = $5 per MH × 10,330 MH = $51,650 Inspection Overhead Budgeted inspection-hours = (0.5 26 batches) + (0.6 19 batches) = 13 + 11.4 = 24.4 inspection hrs. Budgeted inspection costs = $16 per inspection hr. 24.4 inspection hours = $390.40 6-22
Image of page 22
Manufacturing Overhead Budget For the Month of April Machine setup costs $ 7,225 Processing costs 51,650 Inspection costs 390 Total costs $59,265 6. Unit Costs of Ending Finished Goods Inventory April 30, 20xx Product Cat-allac Dog-errific Cost per Input per Input per Unit of Input Unit of Output Total Unit of Output Total Plastic $ 4 4 lbs. $ 16.00 6 lbs. $ 24.00 Metal 3 0.5 lbs. 1.50 1 lb. 3.00 Direct manufacturing labor 10 3 hrs. 30.00 5 hrs. 50.00 Machine setup 100 0.075 hrs. 1 7.50 0.1167 hr 1 11.67 Processing 5 10 MH 50.00 18 MH 90.00 Inspection 16 0.025 hr 2 0.40 0.04 hr. 2 0.64 Total $105.40 $179.31 1 39 setup-hours ÷ 520 units = 0.075 hours per unit; 33.25 setup-hours ÷ 285 units = 0.1167 hours per unit 2 13 inspection hours ÷ 520 units = 0.025 hours per unit; 11.4 inspection hours ÷ 285 units = 0.04 hours per unit Ending Inventories Budget April 30, 20xx Quantity Cost per unit Total Direct Materials Plastic 380 $4 $1,520 Metals 55 3 165 $1,685 Finished goods Cat-allac 35 $105.40 $3,689 Dog-errific 15 179.31 2,690 6,379 Total ending inventory $8,064 6-23
Image of page 23

Subscribe to view the full document.

7.
Image of page 24
Image of page 25
You've reached the end of this preview.
  • Winter '10
  • LAWWINGKIN
  • Accounting, Finished Goods, Direct manufacturing Labor

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern