, and sales manager, has gathered the following data for use in developing the budgeted income statement for March: Estimated sales for March: Batting helmet 1,200 units at $40 per unit Football helmet 6,500 units at $160 per unit Estimated inventories at March 1: Direct materials:
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Part 2 of previous question
The budget director of Gold Medal Athletic Co., with the assistance of the controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income statement for March:
- Estimated sales for March:
Batting helmet 1,200 units at $40 per unit Football helmet 6,500 units at $160 per unit - Estimated inventories at March 1:
Direct materials: Plastic 90 lb. Foam lining 80 lb. Finished products: Batting helmet 40 units at $25 per unit Football helmet 240 units at $77 per unit - Desired inventories at March 31:
Direct materials: Plastic 50 lb. Foam lining 65 lb. Finished products: Batting helmet 50 units at $25 per unit Football helmet 220 units at $78 per unit - Direct materials used in production:
In manufacture of batting helmet: Plastic 1.20 lb. per unit of product Foam lining 0.50 lb. per unit of product In manufacture of football helmet: Plastic 3.50 lb. per unit of product Foam lining 1.50 lb. per unit of product - Anticipated cost of purchases and beginning and ending inventory of direct materials:
Plastic $6.00 per lb. Foam lining $4.00 per lb. - Direct labor requirements:
Batting helmet: Molding Department 0.20 hr. at $20 per hr. Assembly Department 0.50 hr. at $14 per hr. Football helmet: Molding Department 0.50 hr. at $20 per hr. Assembly Department 1.80 hrs. at $14 per hr. - Estimated factory
overhead costs for March:Indirect factory wages $86,000 Depreciation of plant and equipment 12,000 Power and light 4,000 Insurance and property tax 2,300 - Estimated operating expenses for March:
Sales salaries expense $184,300 Advertising expense 87,200 Office salaries expense 32,400 Depreciation expense—office equipment 3,800 Telephone expense—selling 5,800 Telephone expense—administrative 1,200 Travel expense—selling 9,000 Office supplies expense 1,100 Miscellaneous administrative expense 1,000 - Estimated other income and expense for March:
Interest revenue $940 Interest expense 872 - Estimated tax rate: 30%
3. Prepare a direct materials purchases budget for March. Enter all amounts as positive numbers.
Gold Medal Athletic Co. Direct Materials Purchases Budget For the Month Ending March 31 |
||||||
---|---|---|---|---|---|---|
Plastic | Foam Lining | Total | ||||
Units required for production: | ||||||
Batting helmet | fill in the blank 18 | fill in the blank 19 | ||||
Football helmet | fill in the blank 20 | fill in the blank 21 | ||||
Plus desired units of inventory, March 31 | fill in the blank 22 | fill in the blank 23 | ||||
Total units required | fill in the blank 24 | fill in the blank 25 | ||||
Less estimated units of inventory, March 1 | fill in the blank 26 | fill in the blank 27 | ||||
Total units to be purchased | fill in the blank 28 | fill in the blank 29 | ||||
Unit price | $fill in the blank 30 | $fill in the blank 31 | ||||
Total direct materials to be purchased | $fill in the blank 32 | $fill in the blank 33 | $fill in the blank 34 |
4. Prepare a direct labor cost budget for March.
Gold Medal Athletic Co. Direct Labor Cost Budget For the Month Ending March 31 |
||||||
---|---|---|---|---|---|---|
Molding Department |
Assembly Department |
Total | ||||
Hours required for production: | ||||||
Batting helmet | fill in the blank 35 | fill in the blank 36 | ||||
Football helmet | fill in the blank 37 | fill in the blank 38 | ||||
Total hours required | fill in the blank 39 | fill in the blank 40 | ||||
Hourly rate | $fill in the blank 41 | $fill in the blank 42 | ||||
Total direct labor cost | $fill in the blank 43 | $fill in the blank 44 | $fill in the blank 45 |
5. Prepare a
Gold Medal Athletic Co. Factory Overhead Cost Budget For the Month Ending March 31 |
|
---|---|
Indirect factory wages | $fill in the blank 46 |
Depreciation of plant and equipment | fill in the blank 47 |
Power and light | fill in the blank 48 |
Insurance and property tax | fill in the blank 49 |
Total | $fill in the blank 50 |
![](/static/compass_v2/shared-icons/check-mark.png)
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 3 images
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
![Horngren's Cost Accounting: A Managerial Emphasis…](https://www.bartleby.com/isbn_cover_images/9780134475585/9780134475585_smallCoverImage.gif)
![Intermediate Accounting](https://www.bartleby.com/isbn_cover_images/9781259722660/9781259722660_smallCoverImage.gif)
![Financial and Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781259726705/9781259726705_smallCoverImage.gif)