Calculate the standard cost per unit for ABC Company. ABC Company's budgeted sales for June, July, and August are 15,000,19,000, and 16,700 units respectively. Each unit that ABC Companyproduces uses 4 pounds of raw material. ABC requires 35% of the nextmonth's budgeted production as raw material inventory each month. ABCCompany currently pays a standard rate of $1.2 per pound for rawmaterials. Each unit should be produced in 15 minutes of direct labor timeat a standard direct labor rate of $11.2 per hour. Manufacturing overheadis applied at the standard rate of $15.2 per direct labor hour.Calculate the standard cost per unit for ABC Company.(Round your answer to 2 decimal places.)

Step 1: Definition of Standard Cost Per UnitThe Standard Cost Per Unit represents the budgeted cost…

Answered: ABC Company's budgeted sales for June,…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter7: Budgeting

Section: Chapter Questions

Problem 1PA: Lens Junction sells lenses for $45 each and is estimating sales of 15,000 units in January and...

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Sunrise Poles manufactures hiking poles and is planning on producing 4,000 units in March and 3,700 in April. Each pole requires a half pound of material, which costs $1.20 per pound. The companys policy is to have enough material on hand to equal 10% of the next months production needs and to maintain a finished goods inventory equal to 25% of the next months production needs. What is the budgeted cost of purchases for March?
Cloud Shoes manufactures recovery sandals and is planning on producing 12.000 units in March and 11,500 in April. Each sandal requires 1.2 yards if material, which costs $3.00 per yard. The companys policy is to have enough material on hand to equal 15% of next months production needs and to maintain a finished goods inventory equal to 20% of the next months production needs. What is the budgeted cost of purchases for March?
Lens & Shades sells sunglasses for $37 each and is estimating sales of 21,000 units in January and 19,000 in February. Each lens consist of 2.00 mm of plastic costing $2.50 per mm, 1.7 oz of dye costing $2.80 per ounce. and 0.50 hours direct labor at a labor rate of $18 per unit. Desired inventory levels are: Prepare a sales budget, production budget, direct materials budget for silicon and solution, and a direct labor budget.
Shalimar Company manufactures and sells industrial products. For next year, Shalimar has budgeted the follow sales: In Shalimars experience, 10 percent of sales are paid in cash. Of the sales on account, 65 percent are collected in the quarter of sale, 25 percent are collected in the quarter following the sale, and 7 percent are collected in the second quarter after the sale. The remaining 3 percent are never collected. Total sales for the third quarter of the current year are 4,900,000 and for the fourth quarter of the current year are 6,850,000. Required: 1. Calculate cash sales and credit sales expected in the last two quarters of the current year, and in each quarter of next year. 2. Construct a cash receipts budget for Shalimar Company for each quarter of the next year, showing the cash sales and the cash collections from credit sales. 3. What if the recession led Shalimars top management to assume that in the next year 10 percent of credit sales would never be collected? The expected payment percentages in the quarter of sale and the quarter after sale are assumed to be the same. How would that affect cash received in each quarter? Construct a revised cash budget using the new assumption.
Nashler Company has the following budgeted variable costs per unit produced: Budgeted fixed overhead costs per month include supervision of 98,000, depreciation of 76,000, and other overhead of 245,000. Required: 1. Prepare a flexible budget for all costs of production for the following levels of production: 160,000 units, 170,000 units, and 175,000 units. 2. What is the per-unit total product cost for each of the production levels from Requirement 1? (Round each unit cost to the nearest cent.) 3. What if Nashler Companys cost of maintenance rose to 0.22 per unit? How would that affect the unit product costs calculated in Requirement 2?
Nozama.com Inc. sells consumer electronics over the Internet. For the next period, the budgeted cost of the sales order processing activity is 250,000 and 50,000 sales orders are estimated to be processed. a. Determine the activity rate of the sales order processing activity. b. Determine the amount of sales order processing cost associated with 30,000 sales orders.
Salisbury Bottle Company manufactures plastic two-liter bottles for the beverage industry. The cost standards per 100 two-liter bottles are as follows: At the beginning of March, Salisburys management planned to produce 500,000 bottles. The actual number of bottles produced for March was 525,000 bottles. The actual costs for March of the current year were as follows: a. Prepare the March manufacturing standard cost budget (direct labor, direct materials, and factory overhead) for Salisbury, assuming planned production. b. Prepare a budget performance report for manufacturing costs, showing the total cost variances for direct materials, direct labor, and factory overhead for March. c. Interpret the budget performance report.
TIB makes custom guitars and prepared the following sales budget for the second quarter It also has this additional information related to its expenses: Direct material per unit $55, Direct labor per hour 20, Variable manufacturing overhead per hour 3.50, Fixed manufacturing overhead per month 3,000, Sales commissions per unit 20, Sales salaries per month 5,000, Delivery expense per unit 0.50, Utilities per month 4,000. Administrative salaries per month 20,000, Marketing expenses per month 8,000, Insurance expense per month 11,000, Depreciation expense per month 9,000. Prepare a sales and administrative expense budget for each month in the quarter ended June 30. 2018.
Krouse Company produces two products, forged putter heads and laminated putter heads, which are sold through specialty golf shops. The company is in the process of developing itsoperating budget for the coming year. Selected data regarding the companys two products areas follows: Manufacturing overhead is applied to units using direct labor hours. Variable manufacturing overhead Ls projected to be 25,000, and fixed manufacturing overhead is expected to be15,000. The estimated cost to produce one unit of the laminated putter head is: a. 42. b. 46. c. 52. d. 62.
One Device makes universal remote controls and expects to sell 500 units in January, 800 in February, 450 in March, 550 in April, and 600 in May. The required ending inventory is 20% of the next months sales. Prepare a production budget for the first four months of the year.
Play-Disc makes Frisbee-type plastic discs. Each 12-inch diameter plastic disc has the following manufacturing costs: For the coming year, Play-Disc expects to make 300,000 plastic discs, and to sell 285,000 of them. Budgeted beginning inventory in units is 16,000 with unit cost of 4.75. (There are no beginning or ending inventories of work in process.) Required: 1. Prepare an ending finished goods inventory budget for Play-Disc for the coming year. 2. What if sales increased to 290,000 discs? How would that affect the ending finished goods inventory budget? Calculate the value of budgeted ending finished goods inventory.
The sales department of Macro Manufacturing Co. has forecast sales for its single product to be 20,000 units for June, with three-quarters of the sales expected in the East region and one-fourth in the West region. The budgeted selling price is 25 per unit. The desired ending inventory on June 30 is 2,000 units, and the expected beginning inventory on June 1 is 3,000 units. Prepare the following: a. A sales budget for June. b. A production budget for June.

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