Lauren produces designer dog collars. She expects to sell 60,000 collars in April; 75,000 collars in May; 70,000 collars in June; and 65,000 collars in July. The company desires that the inventory on hand at the end of each month be equal to 40% of the next month's expected unit collar sales. Due to excessive production during March, on March 31 there were 25,000 collars in the ending inventory. Required: Prepare a production budget for April, May and June. Problem #2: Given the following information, prepare a monthly materials purchases budget for the plastic needed to make the company's water cannons for the second quarter of 2024. Month Required Production in units March 320 April 350 May 390 June 340 July 330 Standard Cost Card Water Cannons Item Standard Quantity Standard Cost Total Cost per unit Plastic 2 oz $0.50 per oz $1.00 Triggers 1 $0.25 per trigger 50.25 Direct Labor 5 secs $15 per hour $0.021 Additional information and assumptions: - The production manager wants 75% of the plastic needs on hand at the end of each month to ensure they never run out. The company had 505 oz of plastic on hand at the end of March.
Lauren produces designer dog collars. She expects to sell 60,000 collars in April; 75,000 collars in May; 70,000 collars in June; and 65,000 collars in July. The company desires that the inventory on hand at the end of each month be equal to 40% of the next month's expected unit collar sales. Due to excessive production during March, on March 31 there were 25,000 collars in the ending inventory. Required: Prepare a production budget for April, May and June. Problem #2: Given the following information, prepare a monthly materials purchases budget for the plastic needed to make the company's water cannons for the second quarter of 2024. Month Required Production in units March 320 April 350 May 390 June 340 July 330 Standard Cost Card Water Cannons Item Standard Quantity Standard Cost Total Cost per unit Plastic 2 oz $0.50 per oz $1.00 Triggers 1 $0.25 per trigger 50.25 Direct Labor 5 secs $15 per hour $0.021 Additional information and assumptions: - The production manager wants 75% of the plastic needs on hand at the end of each month to ensure they never run out. The company had 505 oz of plastic on hand at the end of March.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Lauren produces designer dog collars. She expects to sell 60,000 collars in April; 75,000 collars in May; 70,000 collars in June; and 65,000 collars in July. The company desires that the inventory on hand at the end of each
month be equal to 40% of the next month's expected unit collar sales. Due to excessive production during March, on March 31 there were 25,000 collars in the ending inventory. Required: Prepare a production budget for April,
May and June. Problem #2: Given the following information, prepare a monthly materials purchases budget for the plastic needed to make the company's water cannons for the second quarter of 2024. Month Required
Production in units March 320 April 350 May 390 June 340 July 330 Standard Cost Card Water Cannons Item Standard Quantity Standard Cost Total Cost per unit Plastic 2 oz $0.50 per oz $1.00 Triggers 1 $0.25 per trigger 50.25
Direct Labor 5 secs $15 per hour $0.021 Additional information and assumptions: - The production manager wants 75% of the plastic needs on hand at the end of each month to ensure they never run out. - The company had
505 oz of plastic on hand at the end of March.
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