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9 A B C D E 4 Ramsey Miller Style, Inc. manufactures a product which requires 15 pounds of direct materials at a cost of $8 5 per pound and 5.0 direct labor hours at a rate of $17 per hour. Variable overhead is budgeted at a rate of $3 per direct labor hour. Budgeted fixed overhead is $433,000 per month. The company's policy is to end each month with direct materials inventory equal to 45% of the next month's direct materials requirement, and finished 7 goods inventory equal to 60% of next month's sales. August sales were 13,400 units, and marketing expects 8 sales to increase by 500 units in each of the upcoming three months. At the end of August, the company had 9 95,850 pounds of direct materials in inventory, and 8,340 units in finished goods inventory. 10 11 August sales 12 Expected increase in monthly sales 13 Desired ending finished goods (units) 14 Selling price per unit 15 Direct materials per unit 16 Direct materials cost 17 Direct labor hours (DLHS) per unit 18 Direct labor rate 19 Budgeted variable overhead 20 Budgeted fixed overhead 21 Direct materials policy 22 August ending materials inventory 23 August ending finished goods inventory 24 25 Required: 13,400 units 500 units 60% of next month's unit sales $680 15 pounds $8 per pound 5.0 DLHS per unit $17 per DLH $3 per DLH $433,000 per month 45% of next month's direct materials requirement 95,850 pounds 8,340 units + 26 (1) Prepare sales budgets for September, October, and November. 27 (2) Prepare production budgets for September, October, and November. H

9 A B C D E 4 Ramsey Miller Style, Inc. manufactures a product which requires 15 pounds of direct materials at a cost of $8 5 per pound and 5.0 direct labor hours at a rate of $17 per hour. Variable overhead is budgeted at a rate of $3 per direct labor hour. Budgeted fixed overhead is $433,000 per month. The company's policy is to end each month with direct materials inventory equal to 45% of the next month's direct materials requirement, and finished 7 goods inventory equal to 60% of next month's sales. August sales were 13,400 units, and marketing expects 8 sales to increase by 500 units in each of the upcoming three months. At the end of August, the company had 9 95,850 pounds of direct materials in inventory, and 8,340 units in finished goods inventory. 10 11 August sales 12 Expected increase in monthly sales 13 Desired ending finished goods (units) 14 Selling price per unit 15 Direct materials per unit 16 Direct materials cost 17 Direct labor hours (DLHS) per unit 18 Direct labor rate 19 Budgeted variable overhead 20 Budgeted fixed overhead 21 Direct materials policy 22 August ending materials inventory 23 August ending finished goods inventory 24 25 Required: 13,400 units 500 units 60% of next month's unit sales $680 15 pounds $8 per pound 5.0 DLHS per unit $17 per DLH $3 per DLH $433,000 per month 45% of next month's direct materials requirement 95,850 pounds 8,340 units + 26 (1) Prepare sales budgets for September, October, and November. 27 (2) Prepare production budgets for September, October, and November. H

Managerial Accounting
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter2: Job Order Costing
Section: Chapter Questions
Problem 4CMA: Patterson Corporation expects to incur 70,000 of factory overhead and 60,000 of general and...
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9 A B C D E 4 Ramsey Miller Style, Inc. manufactures a product which requires 15 pounds of direct materials at a cost of $8 5 per pound and 5.0 direct labor hours at a rate of $17 per hour. Variable overhead is budgeted at a rate of $3 per direct labor hour. Budgeted fixed overhead is $433,000 per month. The company's policy is to end each month with direct materials inventory equal to 45% of the next month's direct materials requirement, and finished 7 goods inventory equal to 60% of next month's sales. August sales were 13,400 units, and marketing expects 8 sales to increase by 500 units in each of the upcoming three months. At the end of August, the company had 9 95,850 pounds of direct materials in inventory, and 8,340 units in finished goods inventory. 10 11 August sales 12 Expected increase in monthly sales 13 Desired ending finished goods (units) 14 Selling price per unit 15 Direct materials per unit 16 Direct materials cost 17 Direct labor hours (DLHS) per unit 18 Direct labor rate 19 Budgeted variable overhead 20 Budgeted fixed overhead 21 Direct materials policy 22 August ending materials inventory 23 August ending finished goods inventory 24 25 Required: 13,400 units 500 units 60% of next month's unit sales $680 15 pounds $8 per pound 5.0 DLHS per unit $17 per DLH $3 per DLH $433,000 per month 45% of next month's direct materials requirement 95,850 pounds 8,340 units + 26 (1) Prepare sales budgets for September, October, and November. 27 (2) Prepare production budgets for September, October, and November. H
Transcribed Image Text:9 A B C D E 4 Ramsey Miller Style, Inc. manufactures a product which requires 15 pounds of direct materials at a cost of $8 5 per pound and 5.0 direct labor hours at a rate of $17 per hour. Variable overhead is budgeted at a rate of $3 per direct labor hour. Budgeted fixed overhead is $433,000 per month. The company's policy is to end each month with direct materials inventory equal to 45% of the next month's direct materials requirement, and finished 7 goods inventory equal to 60% of next month's sales. August sales were 13,400 units, and marketing expects 8 sales to increase by 500 units in each of the upcoming three months. At the end of August, the company had 9 95,850 pounds of direct materials in inventory, and 8,340 units in finished goods inventory. 10 11 August sales 12 Expected increase in monthly sales 13 Desired ending finished goods (units) 14 Selling price per unit 15 Direct materials per unit 16 Direct materials cost 17 Direct labor hours (DLHS) per unit 18 Direct labor rate 19 Budgeted variable overhead 20 Budgeted fixed overhead 21 Direct materials policy 22 August ending materials inventory 23 August ending finished goods inventory 24 25 Required: 13,400 units 500 units 60% of next month's unit sales $680 15 pounds $8 per pound 5.0 DLHS per unit $17 per DLH $3 per DLH $433,000 per month 45% of next month's direct materials requirement 95,850 pounds 8,340 units + 26 (1) Prepare sales budgets for September, October, and November. 27 (2) Prepare production budgets for September, October, and November. H
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