Bowshar Hills Company sells shoes and expects to produce and sell 50,000 units during the year 2022 with no beginning or ending inventories as it plans to produce what it can sell during the same year. The total budgeted fixed manufacturing overhead cost for the year is $50,000. The company accounts show that the budgeted direct material cost is $4 per unit, budgeted direct labor cost is $6 per direct labor hour, and budgeted variable manufacturing overhead is $2 per direct labor hour. Each unit produced takes 2 hours of skilled labor time. The cost of goods sold :reported in the budgeted income statement for 2022 is None of the given answers a O $1,050,000 b O $650,000 .cO $450,000 .dO $850,000 .e O

Bowshar Hills Company sells shoes and expects to produce and sell 50,000 units during the year 2022 with no beginning or ending inventories as it plans to produce what it can sell during the same year. The total budgeted fixed manufacturing overhead cost for the year is $50,000. The company accounts show that the budgeted direct material cost is $4 per unit, budgeted direct labor cost is $6 per direct labor hour, and budgeted variable manufacturing overhead is $2 per direct labor hour. Each unit produced takes 2 hours of skilled labor time. The cost of goods sold :reported in the budgeted income statement for 2022 is None of the given answers a O $1,050,000 b O $650,000 .cO $450,000 .dO $850,000 .e O

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Brabham Enterprises manufactures tires for the Formula I motor racing circuit. For August 2020, it…

A: A flexible budget is prepared by considering the outcome or quantity of actual performance but by…

Q: Treanor Enterprises manufactures tires for the Formula I motor racing circuit. For August 2020, it…

A: An individual's efforts or the results of an activity are discussed in a performance report. The…

Q: Tomm Industries, Inc. (SII), developed standard costs for direct material and direct labor. In 2020,…

A: Direct Material Price Variance is the difference between the actual cost of purchasing materials and…

Q: Winners Company expects to manufacture and sell 30,000 athletic uniforms for £80 each in 2024.…

A: Good day! We are asked to compute the Budgeted for Direct Materials Purchases. First step is to…

Q: How much is the operating income if the company uses variable costing?

A: Variable costing is a costing method used in managerial accounting that only includes variable…

Q: XYZ Company, INC. assumes to make 2,000,000 units of Product A in 2027. Monthly production is…

A: A manufacturing budget is a collection of three budgets that estimate the cost of direct material,…

Q: Shalom Company prepared its 2023 direct labor budget to produce Product Peace. Producing each unit…

A: The entity prepares a budget to estimate the costs to be incurred. The different types of budgets…

Q: Kluver Enterprises manufactures tires for the Formula I motor racing circuit. For August 2020, it…

A: A performance report is a table-like report in which the actual performance, or activity is compared…

Q: Fast Feet Inc. makes running shoes and they are anticipating the incurrence of the following…

A: Budgeting is a method of estimating expected future outcomes based on past events. Budgeting…

Q: Arsons company is planning to produce 2,100 units of product in 2017. Each unit requires 1.60 pounds…

A: Step 1: Introduction to Production Budget and Standard Unit Cost:A manufacturing firm usually…

Q: Each year, Mearic Inc. manufactures 10,000 components that are used in the company's manufacturing…

A: Lets understand the basics. When buy or make decision required to make then management needs to…

Q: Walkenhorst Company's machining department prepared its 2022 budget based on the following data:…

A: Since the student has posted a question with multiple sub-parts, we will solve only the first three…

Q: Prepare a flexible manufacturing budget

A: A manufacturing budget is a collection of three budgets that estimate the cost of direct materials,…

Q: Parsons Company is planning to produce 2,100 units of product in 2017. Each unit requires 2.20…

A: (a) Budgeted amounts for 2017: Direct materials = Units to be produced x Pounds per unit x Cost per…

Q: Blue Devil Inc. sells only one single product in both Michigan and Indiana. The company is preparing…

A: Overhead costs, also known as overhead or operating expenses, are costs associated with running a…

Q: Cap Incorporated manufactures ball point pens that sell at wholesale for $0.80 per unit. Budgeted…

A: The gross margin is calculated as the difference between the revenue and cost of goods sold. The net…

Q: Martinez Company expects to produce 1,152,000 units of Product XX in 2022. Monthly production is…

A: FLEXIBLE BUDGET A flexible budget is a budget that is prepared for different levels of activity or…

Q: from 84,000 to 120.000 units. Budgeted Gundy Company expects to produce 1.305.600 units of Product…

A: Master budget : Summary of all functional budgets such as lower-level budgets, cash flow forecasts,…

Q: For Coronado Company, units to be produced are 5,900 in quarter 1 and 8,260 in quarter 2. It takes…

A: Budgeting is a very useful method of estimating revenue and expenses for an organization.It is…

Q: Flounder Company expects to produce 1,080,000 units of Product XX in 2022. Monthly production is…

A: Variable costs are costs that vary with the change in the level of output whereas fixed costs are…

Concept explainers

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.

Question

Bowshar Hills Company sells shoes and expects to produce and sell 50,000 units during the year 2022 with no
beginning or ending inventories as it plans to produce what it can sell during the same year. The total budgeted fixed
manufacturing overhead cost for the year is $50,000. The company accounts show that the budgeted direct material
cost is $4 per unit, budgeted direct labor cost is $6 per direct labor hour, and budgeted variable manufacturing
overhead is $2 per direct labor hour. Each unit produced takes 2 hours of skilled labor time. The cost of goods sold
:reported in the budgeted income statement for 2022 is
None of the given answers
a O
$1.050,000 b O
$650,000 .c O
$450,000 .dO
$850,000 .e O

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Connolly Enterprises manufactures tires for the Formula I motor racing circuit. For August 2020, it budgeted to manufacture and sell 3,100 tires at a variable cost of $80 per tire and total fixed costs of $52,000. The budgeted selling price was $110 per tire. Actual results in August 2020 were 2,900 tires manufactured and sold at a selling price of $114 per tire. The actual total variable costs were $255,200, and the actual total fixed costs were $48,000. Read the requirements Requirement 1. Prepare a performance report with a flexible budget and a static budget. Begin with the actual results, then complete the flexible budget columns and the static budget columns. Label each variance as favorable or unfavorable. (For variances with a $0 balance, make sure to enter "0" in the appropriate field. If the variance is zero, do not select a label.) Units sold Revenues Variable costs Contribution margin Fixed costs Operating income Actual Results
Cap Incorporated manufactures ball point pens that sell at wholesale for $0.80 per unit. Budgeted production in both 2021 and 2022 was 13,000 units. There was no beginning inventory in 2021. The following data summarized the 2021 and 2022 operations: 2021 2022 Units sold 11,500 12,000 Units produced 13,000 13,000 Costs: Variable factory overhead per unit $ 0.15 $ 0.15 Fixed factory overhead $ 2,600 $ 2,600 Variable marketing per unit $ 0.30 $ 0.30 Fixed Selling and Administrative $ 320 $ 320 Full costing operating income for 2022 is calculated to be: (Do not round intermediate calculations. Round your final answers to whole dollar amounts.) Multiple Choice $1,480. $214. $2,150. $1,700. $1,518.
NUBD Co. budgeted sales of 400,000 calculators at P40 for 2021. Variable manufacturing costs were budgeted at P16 per unit, and fixed manufacturing costs at P10 per unit. A special order offering to buy 40,000 calculators for P23 each was received by NUBD Co. in October 2021. NUBD Co. has sufficient plant capacity to manufacture the additional quantity; however, the production would have to be done on an overtime basis at an estimated additional cost of P3 per calculator. Acceptance of the special order will not affect NUBD’s normal sales and no selling expenses would be incurred. What would be the effect on operating profit (loss) if the special order were accepted?
Sweeney Enterprises manufactures tires for the Formula I motor racing circuit. For August 2017 it budgeted to manufacture and sell 3,600 tires at a variable cost of $71 per tire and total fixed costs of $55,000. The budgeted selling price was $114 per tire. Actual results in August 2017 weere 3,500 tires manufactured and sold at a selling price of $116 per tire. The actual total variable costs were $280,000, and the actual total fixed costs were $51,000. Prepare a performance report that uses flexible budget and a static budget. Determine if the result are favorable or unfavorable. Comment on the results
Sheffield, Inc. is planning to produce 2,560 units of product in 2022. Each unit requires 3 pounds of materials at $6 per pound and a half hour of labor at $16 per hour. The overhead rate is 75% of direct labor. (a) Your answer has been saved. See score details after the due date. Compute the budgeted amounts for 2022 for direct materials to be used, direct labor, and applied overhead. Direct Materials $ (b) Direct Labor Overhead Standard Cost Save for Later $ $ $ 46080 Compute the standard cost of one unit of product. (Round answer to 2 decimal places, e.g. 52.75.) 20480 15360 Attempts: 1 of 1 used Attempts: 0 of 1 used Submit Answer
ABX Company plans to produce 50,000 units of Peace Products in 2023. Budgeted variable manufacturing costs per unit are direct materials P7, direct labor P12, and overhead P18. Annual budgeted fixed manufacturing overhead costs are P96,000 for depreciation and P45,000 for supervision. In February, Shalom produced 6,000 units and incurred the following costs: direct materials P38,900, direct labor P70,200, variable overhead P116,500, depreciation P8,000, and supervision P4,000. Need solution Direct materials: ANS: 3,100 F Total fixed manufacturing overhead: ___ How much was the total variable manufacturing cost? ANS: 222,000
Please help me to solve this problem
Smooth Incorporated manufactures hair brushes that sell at wholesale for $2.60 per unit. Budgeted production in both 2021 and 2022 was 4,000 units. There was no beginning inventory in 2021. The following data summarized the 2021 and 2022 operations: 2021 2022 Units sold 3,000 4,200 Units produced 4,000 4,000 Costs: Variable factory overhead per unit $ 0.55 $ 0.65 Fixed factory overhead $ 1,800 $ 1,800 Variable marketing per unit $ 0.75 $ 1.00 Fixed Selling and Administrative $ 650 $ 650 Full costing operating income for 2021 is calculated to be: (Do not round intermediate calculations. Round your final answers to whole dollar amounts.) Multiple Choice $1,450. $1,900. $1,950. $1,521. $1,569.
aHRiIh mahufactures pipes and applies manufacturing overhead costs to production at a budgeted indirect-cost rate of $18 per direct labor-hour. The following data are obtained from the accounting records for June 2020: Direct materials $140,000 Direct labor (4,000 hours @ $10/hour) 40,000 Indirect labor 13,000 Plant facility rent 30,000 Depreciation on plant mach. & equip. 22,500 Sales commissions 24,000 Administrative expenses 28,000 For June 2020, manufacturing overhead is O overallocated by $6.500 Ounderallocated by $21.500 ovrcallocated by $21.500
Paula Corporation reports the following for this month: The beginning inventory is 30 units. It produces 140 units during this month. And 150 units are sold at $3,000 each. The budgeted level of production used to calculate the budgeted fixed manufacturing cost per unit is 200 units, the same every month. Variable costs: manufacturing cost per unit = $100; the operating cost per unit = $20 Total Fixed costs: budgeted manufacturing costs = $7,000; operating costs = $36,000 How much is the unit product cost if the company uses absorption costing? $100 $120 $150 $335 $315 $135