Problems6-28 Budget schedules for a manufacturer. Logo Specialties manufactures, among other things, woolenblankets for the athletic teams of the two local high schools. The company sews the blankets from fabricand sews on a logo patch purchased from the licensed logo store site. The teams are as follows:Knights, with red blankets and the Knights logoRaiders, with black blankets and the Raider logoAlso, the black blankets are slightly larger than the red blankets.The budgeted direct-cost inputs for each product in 2012 are as follows:Knights Blanket3 yardsRaiders BlanketRed wool fabricBlack wool fabric3.3 yardsKnight logo patchesRaider logo patchesDirect manufacturing labor111.5 hours2 hoursUnit data pertaining to the direct materials for March 2012 are as follows:Actual Beginning Direct Materials Inventory (3/1/2012)Knights Blanket30 yardsRaiders BlanketRed wool fabricBlack wool fabric10 yardsKnight logo patchesRaider logo patches4055Target Ending Direct Materials Inventory (3/31/2012)Knights Blanket20 yardsRaiders BlanketRed wool fabricBlack wool fabricKnight logo patchesRaider logo patches20 yards2020Unit cost data for direct-cost inputs pertaining to February 2012 and March 2012 are as follows:February 2012 (actual)$8March 2012 (budgeted)$9Red wool fabric (per yard)Black wool fabric (per yard)Knight logo patches (per patch)Raider logo patches (per patch)Manufacturing labor cost per hour1096652526 Manufacturing overhead (both variable and fixed) is allocated to each blanket on the basis of budgeted directmanufacturing labor-hours per blanket. The budgeted variable manufacturing overhead rate for March 2012is $15 per direct manufacturing labor-hour. The budgeted fixed manufacturing overhead for March 2012 is$9,200. Both variable and fixed manufacturing overhead costs are allocated to each unit of finished goods.Data relating to finished goods inventory for March 2012 are as follows:Knights Blankets10$1,210Raiders BlanketsBeginning inventory in unitsBeginning inventory in dollars (cost)Target ending inventory in units15$2,2352025Budgeted sales for March 2012 are 120 units of the Knights blankets and 180 units of the Raiders blankets.The budgeted selling prices per unit in March 2012 are $150 for the Knights blankets and $175 for the Raidersblankets. Assume the following in your answer:Work-in-process inventories are negligible and ignored.Direct materials inventory and finished goods inventory are costed using the FIFO method.Unit costs of direct materials purchased and finished goods are constant in March 2012.1. Prepare the following budgets for March 2012:a. Revenues budgetb. Production budget in unitsc. Direct material usage budget and direct material purchases budgetd. Direct manufacturing labor budgete. Manufacturing overhead budgetf. Ending inventories budget (direct materials and finished goods)g. Cost of goods sold budget

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Transcribed Image Text:Problems 6-28 Budget schedules for a manufacturer. Logo Specialties manufactures, among other things, woolen blankets for the athletic teams of the two local high schools. The company sews the blankets from fabric and sews on a logo patch purchased from the licensed logo store site. The teams are as follows: Knights, with red blankets and the Knights logo Raiders, with black blankets and the Raider logo Also, the black blankets are slightly larger than the red blankets. The budgeted direct-cost inputs for each product in 2012 are as follows: Knights Blanket 3 yards Raiders Blanket Red wool fabric Black wool fabric 3.3 yards Knight logo patches Raider logo patches Direct manufacturing labor 1 1 1.5 hours 2 hours Unit data pertaining to the direct materials for March 2012 are as follows: Actual Beginning Direct Materials Inventory (3/1/2012) Knights Blanket 30 yards Raiders Blanket Red wool fabric Black wool fabric 10 yards Knight logo patches Raider logo patches 40 55 Target Ending Direct Materials Inventory (3/31/2012) Knights Blanket 20 yards Raiders Blanket Red wool fabric Black wool fabric Knight logo patches Raider logo patches 20 yards 20 20 Unit cost data for direct-cost inputs pertaining to February 2012 and March 2012 are as follows: February 2012 (actual) $8 March 2012 (budgeted) $9 Red wool fabric (per yard) Black wool fabric (per yard) Knight logo patches (per patch) Raider logo patches (per patch) Manufacturing labor cost per hour 10 9 6 6 5 25 26

Manufacturing overhead (both variable and fixed) is allocated to each blanket on the basis of budgeted direct
manufacturing labor-hours per blanket. The budgeted variable manufacturing overhead rate for March 2012
is $15 per direct manufacturing labor-hour. The budgeted fixed manufacturing overhead for March 2012 is
$9,200. Both variable and fixed manufacturing overhead costs are allocated to each unit of finished goods.
Data relating to finished goods inventory for March 2012 are as follows:
Knights Blankets
10
$1,210
Raiders Blankets
Beginning inventory in units
Beginning inventory in dollars (cost)
Target ending inventory in units
15
$2,235
20
25
Budgeted sales for March 2012 are 120 units of the Knights blankets and 180 units of the Raiders blankets.
The budgeted selling prices per unit in March 2012 are $150 for the Knights blankets and $175 for the Raiders
blankets. Assume the following in your answer:
Work-in-process inventories are negligible and ignored.
Direct materials inventory and finished goods inventory are costed using the FIFO method.
Unit costs of direct materials purchased and finished goods are constant in March 2012.
1. Prepare the following budgets for March 2012:
a. Revenues budget
b. Production budget in units
c. Direct material usage budget and direct material purchases budget
d. Direct manufacturing labor budget
e. Manufacturing overhead budget
f. Ending inventories budget (direct materials and finished goods)
g. Cost of goods sold budget

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1. Prepare the following budgets for March 2012: a. Revenues budget b. Production budget in units c. Direct material usage budget and direct material purchases budget