Cost of Goods Sold Budget Play-Disc makes Frisbee-type plastic discs. Each 12-inch diameter plastic disc has the following manufacturing costs: Direct materials $1.65 Direct labor 0.60 Variable overhead. 0.75 Fixed overhead 1.80 Total unit cost $4.80 For the coming year, Play-Disc expects to make 300,000 plastic discs, and to sell 281,000 of them. Budgeted beginning inventory in units is 17,000 with unit cost of $4.80. (There are no beginning or ending inventories of Required:
Cost of Goods Sold Budget Play-Disc makes Frisbee-type plastic discs. Each 12-inch diameter plastic disc has the following manufacturing costs: Direct materials $1.65 Direct labor 0.60 Variable overhead. 0.75 Fixed overhead 1.80 Total unit cost $4.80 For the coming year, Play-Disc expects to make 300,000 plastic discs, and to sell 281,000 of them. Budgeted beginning inventory in units is 17,000 with unit cost of $4.80. (There are no beginning or ending inventories of Required:
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter8: Budgeting For Planning And Control
Section: Chapter Questions
Problem 6CE: Play-Disc makes Frisbee-type plastic discs. Each 12-inch diameter plastic disc has the following...
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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
2. Prepare a cost of goods sold budget for Play-Disc for the year.
3. What if the beginning inventory of finished goods was $80,900 (for 17,000 units)? How would that affect the cost of goods sold budget? (Assume Play-Disc uses the FIFO method.)
Transcribed Image Text:Cost of Goods Sold Budget
Play-Disc makes Frisbee-type plastic discs. Each 12-inch diameter plastic disc has the following manufacturing costs:
Direct materials
$1.65
Direct labor
0.60
Variable overhead
0.75
Fixed overhead
1.80
Total unit cost
$4.80
For the coming year, Play-Disc expects to make 300,000 plastic discs, and to sell 281,000 of them. Budgeted beginning inventory in units is 17,000 with unit cost of $4.80. (There are no beginning or ending inventories of wa
Required:
1. Calculate the total budgeted cost of units produced for Play-Disc for the coming year. Show the cost of direct materials, direct labor, and overhead.
Budgeted direct materials
495,000 ✓
Budgeted direct labor
180,000
Budgeted overhead
765,000 ✓
Total budgeted manufacturing cost
1,440,000 ✓
2. Prepare a cost of goods sold budget for Play-Disc for the year.
Play-Disc
Cost of Goods Sold Budget
For the Year
Direct materials
Direct labor
Overhead
✓
Total manufacturing cost
Add: Beginning inventory, finished goods
Lecc: Ending inventory finished noods
✓
X
X
X
X
X
Transcribed Image Text:2. Prepare a cost of goods sold budget for Play-Disc for the year.
Play-Disc
Cost of Goods Sold Budget
For the Year
Direct materials
X
Direct labor
X
Overhead
✓
X
Total manufacturing cost
X
Add: Beginning inventory, finished goods
X
Less: Ending inventory, finished goods
✓
100
X
Cost of goods sold
X
3. What if the beginning inventory of finished goods was $80,900 (for 17,000 units)? How would that affect the cost of goods sold budget? (Assume Play-Disc uses the FIFO method.)
The cost of goods sold would decrease ✓to:
X
✓
$
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