Diane Buswell is preparing the 2022 budget for one of Current Designs' rotomolded kayaks. Extensive meetings with members of the sales department and executive team have resulted in the following unit sales projections for 2022. Quarter 1 1,300 kayaks Quarter 2 2,000 kayaks Quarter 3 950 kayaks Quarter 4 950 kayaks Current Designs' policy is to have finished goods ending inventory in a quarter equal to 25% of the next quarter's anticipated sales. Preliminary sales projections for 2023 are 1,100 units for the first quarter and 2,000 units for the second quarter. Ending inventory of finished goods at December 31, 2021, will be 325 rotomolded kayaks. Production of each kayak requires 44 pounds of polyethylene powder and a finishing kit (rope, seat, hardware, etc.). Company policy is that the ending inventory of polyethylene powder should be 20% of the amount needed for production in the next quarter. Assume that the ending inventory of polyethylene powder on December 31, 2021, is 21,800 pounds. The finishing kits can be assembled as they are needed. As a result, Current Designs does not maintain a significant inventory of the finishing kits. The polyethylene powder used in these kayaks costs $1.40 per pound, and the finishing kits cost $180 each. Production of a single kayak requires 4 hours of time by more experienced, type I employees and 5 hours of finishing time by type ll employees. The type I employees are paid $17 per hour, and the type II employees are paid $14 per hour. Selling and administrative expenses for this line are expected to be $43 per unit sold plus $6,700 per quarter. Manufacturing overhead is assigned at 160% of labor costs. Prepare the direct materials budget for this product line by quarter and in total for 2022. (Round cost per pound to 2 decimal places, e.g. 1.25 and other answers to O decimal places, e.g. 125.) ▾ CURRENT DESIGNS Direct Materials Budget-Polyethy Q1 Q2 $ $ $ $ $ $
Diane Buswell is preparing the 2022 budget for one of Current Designs' rotomolded kayaks. Extensive meetings with members of the sales department and executive team have resulted in the following unit sales projections for 2022. Quarter 1 1,300 kayaks Quarter 2 2,000 kayaks Quarter 3 950 kayaks Quarter 4 950 kayaks Current Designs' policy is to have finished goods ending inventory in a quarter equal to 25% of the next quarter's anticipated sales. Preliminary sales projections for 2023 are 1,100 units for the first quarter and 2,000 units for the second quarter. Ending inventory of finished goods at December 31, 2021, will be 325 rotomolded kayaks. Production of each kayak requires 44 pounds of polyethylene powder and a finishing kit (rope, seat, hardware, etc.). Company policy is that the ending inventory of polyethylene powder should be 20% of the amount needed for production in the next quarter. Assume that the ending inventory of polyethylene powder on December 31, 2021, is 21,800 pounds. The finishing kits can be assembled as they are needed. As a result, Current Designs does not maintain a significant inventory of the finishing kits. The polyethylene powder used in these kayaks costs $1.40 per pound, and the finishing kits cost $180 each. Production of a single kayak requires 4 hours of time by more experienced, type I employees and 5 hours of finishing time by type ll employees. The type I employees are paid $17 per hour, and the type II employees are paid $14 per hour. Selling and administrative expenses for this line are expected to be $43 per unit sold plus $6,700 per quarter. Manufacturing overhead is assigned at 160% of labor costs. Prepare the direct materials budget for this product line by quarter and in total for 2022. (Round cost per pound to 2 decimal places, e.g. 1.25 and other answers to O decimal places, e.g. 125.) ▾ CURRENT DESIGNS Direct Materials Budget-Polyethy Q1 Q2 $ $ $ $ $ $
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Diane Buswell is preparing the 2022 budget for one of Current Designs' rotomolded kayaks. Extensive meetings with members of the
sales department and executive team have resulted in the following unit sales projections for 2022.
Quarter 1
1,300 kayaks
Quarter 2
2,000 kayaks
Quarter 3
950 kayaks
Quarter 4
950 kayaks
Current Designs' policy is to have finished goods ending inventory in a quarter equal to 25% of the next quarter's anticipated sales.
Preliminary sales projections for 2023 are 1,100 units for the first quarter and 2,000 units for the second quarter. Ending inventory of
finished goods at December 31, 2021, will be 325 rotomolded kayaks.
Production of each kayak requires 44 pounds of polyethylene powder and a finishing kit (rope, seat, hardware, etc.). Company policy is
that the ending inventory of polyethylene powder should be 20% of the amount needed for production in the next quarter. Assume
that the ending inventory of polyethylene powder on December 31, 2021, is 21,800 pounds. The finishing kits can be assembled as
they are needed. As a result, Current Designs does not maintain a significant inventory of the finishing kits.
The polyethylene powder used in these kayaks costs $1.40 per pound, and the finishing kits cost $180 each. Production of a single
kayak requires 4 hours of time by more experienced, type I employees and 5 hours of finishing time by type ll employees. The type I
employees are paid $17 per hour, and the type II employees are paid $14 per hour.
Selling and administrative expenses for this line are expected to be $43 per unit sold plus $6,700 per quarter. Manufacturing overhead
is assigned at 160% of labor costs.
Transcribed Image Text:Prepare the direct materials budget for this product line by quarter and in total for 2022. (Round cost per pound to 2 decimal places,
e.g. 1.25 and other answers to O decimal places, e.g. 125.)
▾
CURRENT DESIGNS
Direct Materials Budget-Polyethy
Q1
Q2
$
$
$
$
$
$
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