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# AC556 Week 3 Problem Production Budgets Note: It is expected that this problem will be complete using an Excel spreadsheet using formulas. Please see...

Budgeting Assignment - please see attachment
AC556 Week 3 Problem Production Budgets Note: It is expected that this problem will be complete using an Excel spreadsheet using formulas. Please see the Excel Tutorial that is available under the course home tab. The Hale Company finished their sales projections for the coming year. The company produces one product. Part of next year’s sales projections are as follows: July August September October November Projected Sales in units 100,000 125,000 156,000 165,000 185,000 The budget committee has also compiled the following information on inventories: Raw materials Work-in-Process Finished Goods Ending Balance, June 22,000 lbs None 13,000 units Desired ending levels (monthly) 5% of next month’s production needs None 12% of next month’s sales Engineering has developed the following standards upon which the production budgets will be developed: Item Standard Materials usage 5 lbs per unit Material price per pound \$1.50 per pound Labor usage 0.4 hours per unit Labor rate \$30 per hour Machine hours 3 machine hours per unit The Hale Company uses a modified allocation method for allocating overhead costs. The rates that will be used in the coming year are as follows: Overhead item Allocation rate Utilities \$0.50 per machine hour Inspection \$10 per unit produced Factory supplies \$2 per unit produced Depreciation \$35,000 per month Supervision \$12,000 per month Required: Prepare the following production budgets for July, August, and September for the Hale Company: 1. Production budget 2. Materials purchase budget 3. Direct labor budget 4. Overhead budget For the quarter (quarter totals only), prepare the: 5. Cost of goods manufactured budget

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Hale Company - Budgets
July
100,000 Aug
125,000 Sep
156,000 July
100,000
15,000
115,000
(13000)
102,000 Aug
125,000
18,720
143,720
(15,000)
128,720 Sep
156,000
19,800
175,800
(18,720)
157,080...

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