Cost of Goods Sold Budget Harbour Inc. budgeted production of 258,000 personal journals in 20Y6. Paper is required to produce a journal. Assume 5 square yards of paper are required for each journal. The estimated January 1, 20Y6, paper inventory is 25,100 square yards. The desired December 31, 20Y6, paper inventory is 17,000 square yards. Paper costs $0.60 per square yard. Each journal requires assembly. Assume that 6 minutes are required to assemble each journal. Assembly labor costs $16.50 per hour. Prepare a cost of goods sold budget for Harbour Inc. using the information above. Assume the estimated inventories on January 1, 20Y6, for finished goods and work in process were $41,100 and $35,700, respectively. Also assume the desired inventories on December 31, 20Y6, for finished goods and work in process were $49,800 and $50,900, respectively. Factory overhead was budgeted at $197,200. Round your interim calculations to nearest cent, if required. Harbour Inc. Cost of Goods Sold Budget For the Year Ending December 31, 20Y6 Finished goods inventory, January 1, 20Y6 Work in process inventory, January 1, 2016 Direct Materials: Direct materials inventory, January 1, 2016 Direct materials purchases Cost of direct materials available for use Less direct materials inventory, December 31, 20Y6 Cost of direct materials placed in production Direct labor Factory overhead Total manufactoring costs Total work in process during period Less work in process inventory, December 31, 20Y6 Cost of goods manufactured Cost of finished goods available for sale Less finished goods inventory, December 31, 20Y6 Cost of goods sold
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.
Cost of Goods Sold Budget
Harbour Inc. budgeted production of 258,000 personal journals in 20Y6. Paper is required to produce a journal. Assume 5 square yards of paper are required for each journal. The estimated January 1, 20Y6, paper inventory is 25,100 square yards. The desired December 31, 20Y6, paper inventory is 17,000 square yards. Paper costs $0.60 per square yard.
Each journal requires assembly. Assume that 6 minutes are required to assemble each journal. Assembly labor costs $16.50 per hour.
Prepare a cost of goods sold budget for Harbour Inc. using the information above. Assume the estimated inventories on January 1, 20Y6, for finished goods and work in process were $41,100 and $35,700, respectively. Also assume the desired inventories on December 31, 20Y6, for finished goods and work in process were $49,800 and $50,900, respectively. Factory overhead was budgeted at $197,200. Round your interim calculations to nearest cent, if required.
Harbour Inc. |
Cost of Goods Sold Budget |
For the Year Ending December 31, 20Y6 |
Finished goods inventory, January 1, 20Y6 | |
Work in process inventory, January 1, 2016 | |
Direct Materials: | |
Direct materials inventory, January 1, 2016 | |
Direct materials purchases | |
Cost of direct materials available for use | |
Less direct materials inventory, December 31, 20Y6 | |
Cost of direct materials placed in production | |
Direct labor | |
Factory overhead |
Total manufactoring costs | |
Total work in process during period | |
Less work in process inventory, December 31, 20Y6 | |
Cost of goods manufactured | |
Cost of finished goods available for sale | |
Less finished goods inventory, December 31, 20Y6 | |
Cost of goods sold |
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