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Austin, Inc. manufactures model airplane kits and projects production at 550, 620, 600, and 800 kits for the next four quarters (Click the icon to view the manufacturing information.) Prepare Austin's direct materials budget, direct labor budget, and manufacturing overhead budget for the year. Round the direct labor hours needed for production, budgeted overhead costs, and predetermined overhead allocation rate to two decimal places. Round other amounts to the nearest whole number Begin by preparing Austin's direct materials budget. Budgeted kits to be produced Direct materials (ounces) per kit Direct materials needed for production Austin, Inc. Direct Materials Budget For the Year Ended December 31 Plus: Total direct materials needed Less Direct materials in beginning inventory Budgeted purchases of direct materials Direct materials cost per ounce Budgeted cost of direct materials purchases Desired direct materials in ending inventory First Quarter 550 1650 Second Quarter 620 1860 CO Third Quarter 600 1800 Fourth Quarter 800 3 2400 300 Total 2570 3 7710 300

Austin, Inc. manufactures model airplane kits and projects production at 550, 620, 600, and 800 kits for the next four quarters (Click the icon to view the manufacturing information.) Prepare Austin's direct materials budget, direct labor budget, and manufacturing overhead budget for the year. Round the direct labor hours needed for production, budgeted overhead costs, and predetermined overhead allocation rate to two decimal places. Round other amounts to the nearest whole number Begin by preparing Austin's direct materials budget. Budgeted kits to be produced Direct materials (ounces) per kit Direct materials needed for production Austin, Inc. Direct Materials Budget For the Year Ended December 31 Plus: Total direct materials needed Less Direct materials in beginning inventory Budgeted purchases of direct materials Direct materials cost per ounce Budgeted cost of direct materials purchases Desired direct materials in ending inventory First Quarter 550 1650 Second Quarter 620 1860 CO Third Quarter 600 1800 Fourth Quarter 800 3 2400 300 Total 2570 3 7710 300

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Austin, Inc. manufactures model airplane kits and projects production at 550, 620, 600, and 800 kits for the next four quarters (Click the icon to view the manufacturing information.) Prepare Austin's direct materials budget, direct labor budget, and manufacturing overhead budget for the year. Round the direct labor hours needed for production, budgeted overhead costs, and predetermined overhead allocation rate to two decimal places. Round other amounts to the nearest whole number Begin by preparing Austin's direct materials budget. Budgeted kits to be produced Direct materials (ounces) per kit Direct materials needed for production Austin, Inc. Direct Materials Budget For the Year Ended December 31 First Quarter Desired direct materials in ending inventory Plus: Total direct materials needed Less Direct materials in beginning inventory Budgeted purchases of direct materials Direct materials cost per ounce Budgeted cost of direct materials purchases 550 3 1650 Second Quarter 620 1860 Third Quarter 600 3 1800 Fourth Quarter 800 3 2400 300 Total 2570 3 7710 300
Transcribed Image Text:Austin, Inc. manufactures model airplane kits and projects production at 550, 620, 600, and 800 kits for the next four quarters (Click the icon to view the manufacturing information.) Prepare Austin's direct materials budget, direct labor budget, and manufacturing overhead budget for the year. Round the direct labor hours needed for production, budgeted overhead costs, and predetermined overhead allocation rate to two decimal places. Round other amounts to the nearest whole number Begin by preparing Austin's direct materials budget. Budgeted kits to be produced Direct materials (ounces) per kit Direct materials needed for production Austin, Inc. Direct Materials Budget For the Year Ended December 31 First Quarter Desired direct materials in ending inventory Plus: Total direct materials needed Less Direct materials in beginning inventory Budgeted purchases of direct materials Direct materials cost per ounce Budgeted cost of direct materials purchases 550 3 1650 Second Quarter 620 1860 Third Quarter 600 3 1800 Fourth Quarter 800 3 2400 300 Total 2570 3 7710 300
More info Direct materials are three ounces of plastic per kit and the plastic costs $4 per ounce. Indirect materials are considered insignificant and are not included in the budgeting process. Beginning Raw Materials Inventory is 900 ounces, and the company desires to end each quarter with 30% of the materials needed for the next quarter's production. Austin desires a balance of 300 ounces in Raw Materials Inventory at the end of the fourth quarter. Each kit requires 0.75 hours of direct labor at an average cost of $20 per hour. Manufacturing overhead is allocated using direct labor hours as the allocation base. Variable overhead is $0.30 per kit, and fixed overhead is $175 per quarter. Print - X Done
Transcribed Image Text:More info Direct materials are three ounces of plastic per kit and the plastic costs $4 per ounce. Indirect materials are considered insignificant and are not included in the budgeting process. Beginning Raw Materials Inventory is 900 ounces, and the company desires to end each quarter with 30% of the materials needed for the next quarter's production. Austin desires a balance of 300 ounces in Raw Materials Inventory at the end of the fourth quarter. Each kit requires 0.75 hours of direct labor at an average cost of $20 per hour. Manufacturing overhead is allocated using direct labor hours as the allocation base. Variable overhead is $0.30 per kit, and fixed overhead is $175 per quarter. Print - X Done
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