Dorothy Taylor is preparing the 2022 budget for one of Current Designs’ rotomoulded kayaks. Extensive meetings with members of the sales department and executive team have resulted in the following unit sales projections for 2022. Quarter 1 2,900 kayaks Quarter 2 3,400 kayaks Quarter 3 2,600 kayaks Quarter 4 2,600 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 3,400 units for the second quarter. Ending inventory of finished goods at December 31, 2021, will be 725 rotomoulded kayaks. Production of each kayak requires 40 kg 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 kg. 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 $1.20 per kilogram, and the finishing kits cost $180 each. Production of a single kayak requires 2 hours of time by more experienced, type I employees and 3 hours of finishing time by type II employees. The type I employees are paid $13 per hour, and the type II employees are paid $10 per hour. Selling and administrative expenses for this line are expected to be $44 per unit sold plus $7,900 per quarter. Manufacturing overhead is assigned at 140% of labour costs. Prepare the direct labour budget for this product line by quarter and in total for 2022. CURRENT DESIGNS Direct Labour Budget For the Year Ending Dec 31, 2022 More skilled labour Q1 Q2 Q3 Q4 TOTAL select an opening labour budget item enter a number of units enter a number of units enter a number of units enter a number of units enter a number of units select a labour budget item enter a number of hours enter a number of hours enter a number of hours enter a number of hours enter a number of hours select a summarizing line for the first part enter a total number of hours for the first part enter a total number of hours for the first part enter a total number of hours for the first part enter a total number of hours for the first part enter a total number of hours for the first part select a labour budget item $enter a dollar amount $enter a dollar amount $enter a dollar amount $enter a dollar amount $enter a dollar amount select a closing labour budget item $enter a total dollar amount $enter a total dollar amount $enter a total dollar amount $enter a total dollar amount $enter a total dollar amount Less skilled labour Q1 Q2 Q3 Q4 TOTAL select an opening labour budget item enter a number of units enter a number of units enter a number of units enter a number of units enter a number of units select a labour budget item enter a number of hours enter a number of hours enter a number of hours enter a number of hours enter a number of hours select a summarizing line for the first part enter a total number of hours for the first part enter a total number of hours for the first part enter a total number of hours for the first part enter a total number of hours for the first part enter a total number of hours for the first part select a labour budget item $enter a dollar amount $enter a dollar amount $enter a dollar amount $enter a dollar amount $enter a dollar amount select a closing labour budget item $enter a total dollar amount $enter a total dollar amount $enter a total dollar amount $enter a total dollar amount $enter a total dollar amount Total labour costs $enter a total dollar amount for this budget $enter a total dollar amount for this budget $enter a total dollar amount for this budget $enter a total dollar amount for this budget $enter a total dollar amount for this budget

Dorothy Taylor is preparing the 2022 budget for one of Current Designs’ rotomoulded kayaks. Extensive meetings with members of the sales department and executive team have resulted in the following unit sales projections for 2022. Quarter 1 2,900 kayaks Quarter 2 3,400 kayaks Quarter 3 2,600 kayaks Quarter 4 2,600 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 3,400 units for the second quarter. Ending inventory of finished goods at December 31, 2021, will be 725 rotomoulded kayaks. Production of each kayak requires 40 kg 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 kg. 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 $1.20 per kilogram, and the finishing kits cost $180 each. Production of a single kayak requires 2 hours of time by more experienced, type I employees and 3 hours of finishing time by type II employees. The type I employees are paid $13 per hour, and the type II employees are paid $10 per hour. Selling and administrative expenses for this line are expected to be $44 per unit sold plus $7,900 per quarter. Manufacturing overhead is assigned at 140% of labour costs. Prepare the direct labour budget for this product line by quarter and in total for 2022. CURRENT DESIGNS Direct Labour Budget For the Year Ending Dec 31, 2022 More skilled labour Q1 Q2 Q3 Q4 TOTAL select an opening labour budget item enter a number of units enter a number of units enter a number of units enter a number of units enter a number of units select a labour budget item enter a number of hours enter a number of hours enter a number of hours enter a number of hours enter a number of hours select a summarizing line for the first part enter a total number of hours for the first part enter a total number of hours for the first part enter a total number of hours for the first part enter a total number of hours for the first part enter a total number of hours for the first part select a labour budget item $enter a dollar amount $enter a dollar amount $enter a dollar amount $enter a dollar amount $enter a dollar amount select a closing labour budget item $enter a total dollar amount $enter a total dollar amount $enter a total dollar amount $enter a total dollar amount $enter a total dollar amount Less skilled labour Q1 Q2 Q3 Q4 TOTAL select an opening labour budget item enter a number of units enter a number of units enter a number of units enter a number of units enter a number of units select a labour budget item enter a number of hours enter a number of hours enter a number of hours enter a number of hours enter a number of hours select a summarizing line for the first part enter a total number of hours for the first part enter a total number of hours for the first part enter a total number of hours for the first part enter a total number of hours for the first part enter a total number of hours for the first part select a labour budget item $enter a dollar amount $enter a dollar amount $enter a dollar amount $enter a dollar amount $enter a dollar amount select a closing labour budget item $enter a total dollar amount $enter a total dollar amount $enter a total dollar amount $enter a total dollar amount $enter a total dollar amount Total labour costs $enter a total dollar amount for this budget $enter a total dollar amount for this budget $enter a total dollar amount for this budget $enter a total dollar amount for this budget $enter a total dollar amount for this budget

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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Question

Quarter 1	2,900	kayaks
Quarter 2	3,400	kayaks
Quarter 3	2,600	kayaks
Quarter 4	2,600	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 3,400 units for the second quarter. Ending inventory of finished goods at December 31, 2021, will be 725 rotomoulded kayaks.

Production of each kayak requires 40 kg 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 kg. 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 $1.20 per kilogram, and the finishing kits cost $180 each. Production of a single kayak requires 2 hours of time by more experienced, type I employees and 3 hours of finishing time by type II employees. The type I employees are paid $13 per hour, and the type II employees are paid $10 per hour.

Selling and administrative expenses for this line are expected to be $44 per unit sold plus $7,900 per quarter. Manufacturing overhead is assigned at 140% of labour costs.

Prepare the direct labour budget for this product line by quarter and in total for 2022.

CURRENT DESIGNS Direct Labour Budget For the Year Ending Dec 31, 2022
More skilled labour	Q1	Q2	Q3	Q4	TOTAL
select an opening labour budget item	enter a number of units	enter a number of units	enter a number of units	enter a number of units	enter a number of units
select a labour budget item	enter a number of hours	enter a number of hours	enter a number of hours	enter a number of hours	enter a number of hours
select a summarizing line for the first part	enter a total number of hours for the first part	enter a total number of hours for the first part	enter a total number of hours for the first part	enter a total number of hours for the first part	enter a total number of hours for the first part
select a labour budget item	$enter a dollar amount	$enter a dollar amount	$enter a dollar amount	$enter a dollar amount	$enter a dollar amount
select a closing labour budget item	$enter a total dollar amount	$enter a total dollar amount	$enter a total dollar amount	$enter a total dollar amount	$enter a total dollar amount
Less skilled labour	Q1	Q2	Q3	Q4	TOTAL
select an opening labour budget item	enter a number of units	enter a number of units	enter a number of units	enter a number of units	enter a number of units
select a labour budget item	enter a number of hours	enter a number of hours	enter a number of hours	enter a number of hours	enter a number of hours
select a summarizing line for the first part	enter a total number of hours for the first part	enter a total number of hours for the first part	enter a total number of hours for the first part	enter a total number of hours for the first part	enter a total number of hours for the first part
select a labour budget item	$enter a dollar amount	$enter a dollar amount	$enter a dollar amount	$enter a dollar amount	$enter a dollar amount
select a closing labour budget item	$enter a total dollar amount	$enter a total dollar amount	$enter a total dollar amount	$enter a total dollar amount	$enter a total dollar amount
Total labour costs	$enter a total dollar amount for this budget	$enter a total dollar amount for this budget	$enter a total dollar amount for this budget	$enter a total dollar amount for this budget	$enter a total dollar amount for this budget

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