FreshPak Corporation manufactures two types of cardboard boxes used in shipping canned food, fruit, and vegetables. The canned food box (type C) and the perishable food box (type P) have the following material and labor requirements. Direct material required per 100 boxes: Paperboard ($0.32 per pound) Corrugating medium ($0.16 per pound) Direct labor required per 100 boxes ($16.00 per hour) Type of Box 50 pounds 40 pounds 0.35 hour 90 pounds 50 pounds 0.70 hour The following production-overhead costs are anticipated for the next year. The predetermined overhead rate is based on a production volume of 440,000 units for each type of box. Production overhead is applied on the basis of direct-labor hours. Indirect material Indirect labor Utilities Property taxes Insurance Depreciation Total $ 13,350 91,650 37,500 25,000 18,000 45,500 $ 231,000 The following selling and administrative expenses are anticipated for the next year. Salaries and fringe benefits of sales personnel Advertising Management salaries and fringe benefits Clerical wages and fringe benefits Miscellaneous administrative expenses Total The sales forecast for the next year is as follows: $ 127,500 27,500 145,000 44,000 7,000 $ 351,000 Box type C Box type P Sales Volume 445,000 boxes 445,000 boxes Sales Price $ 115.00 175.00 per hundred boxes per hundred boxes The following inventory information is available for the next year. The unit production costs for each product are expected to be the same this year and next year. Expected Inventory January 1 Desired Ending Inventory December 31 Finished goods: Box type C Box type P Raw material: Paperboard Corrugating medium 20,000 boxes 30,000 boxes 15,000 boxes 25,000 boxes 13,000 pounds 4,000 pounds 3,000 pounds 9,000 pounds Prepare a master budget for Fresh Pak Corporation for the next year. Assume an income tax rate of 40 percent.
FreshPak Corporation manufactures two types of cardboard boxes used in shipping canned food, fruit, and vegetables. The canned food box (type C) and the perishable food box (type P) have the following material and labor requirements. Direct material required per 100 boxes: Paperboard ($0.32 per pound) Corrugating medium ($0.16 per pound) Direct labor required per 100 boxes ($16.00 per hour) Type of Box 50 pounds 40 pounds 0.35 hour 90 pounds 50 pounds 0.70 hour The following production-overhead costs are anticipated for the next year. The predetermined overhead rate is based on a production volume of 440,000 units for each type of box. Production overhead is applied on the basis of direct-labor hours. Indirect material Indirect labor Utilities Property taxes Insurance Depreciation Total $ 13,350 91,650 37,500 25,000 18,000 45,500 $ 231,000 The following selling and administrative expenses are anticipated for the next year. Salaries and fringe benefits of sales personnel Advertising Management salaries and fringe benefits Clerical wages and fringe benefits Miscellaneous administrative expenses Total The sales forecast for the next year is as follows: $ 127,500 27,500 145,000 44,000 7,000 $ 351,000 Box type C Box type P Sales Volume 445,000 boxes 445,000 boxes Sales Price $ 115.00 175.00 per hundred boxes per hundred boxes The following inventory information is available for the next year. The unit production costs for each product are expected to be the same this year and next year. Expected Inventory January 1 Desired Ending Inventory December 31 Finished goods: Box type C Box type P Raw material: Paperboard Corrugating medium 20,000 boxes 30,000 boxes 15,000 boxes 25,000 boxes 13,000 pounds 4,000 pounds 3,000 pounds 9,000 pounds Prepare a master budget for Fresh Pak Corporation for the next year. Assume an income tax rate of 40 percent.
Chapter1: Financial Statements And Business Decisions
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