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MCO Leather manufactures leather purses. Each purse requires 2 pounds of direct materials at a cost of $4 per pound and 0.7 direct labor hour at a rate of $11 per hour. Variable overhead is budgeted at a rate of $3 per direct labor hour. Budgeted fixed overhead is $20,000 per month. The company's policy is to end each month with direct materials inventory equal to 20% of the next month's direct materials requirement. At the end of August the company had 1,800 pounds of direct materials in inventory. The company's production budget reports the following. Production Budget Units to produce September 4,500 October 7,200 November 6,100 (1) Prepare direct materials budgets for September and October. (2) Prepare direct labor budgets for September and October. (3) Prepare factory overhead budgets for September and October. Complete this question by entering your answers in the tabs below.

MCO Leather manufactures leather purses. Each purse requires 2 pounds of direct materials at a cost of $4 per pound and 0.7 direct labor hour at a rate of $11 per hour. Variable overhead is budgeted at a rate of $3 per direct labor hour. Budgeted fixed overhead is $20,000 per month. The company's policy is to end each month with direct materials inventory equal to 20% of the next month's direct materials requirement. At the end of August the company had 1,800 pounds of direct materials in inventory. The company's production budget reports the following. Production Budget Units to produce September 4,500 October 7,200 November 6,100 (1) Prepare direct materials budgets for September and October. (2) Prepare direct labor budgets for September and October. (3) Prepare factory overhead budgets for September and October. Complete this question by entering your answers in the tabs below.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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MCO Leather manufactures leather purses. Each purse requires 2 pounds of direct materials at a cost of $4 per pound and 0.7 direct labor hour at a rate of $11 per hour. Variable overhead is budgeted at a rate of $3 per direct labor hour. Budgeted fixed overhead is $20,000 per month. The company's policy is to end each month with direct materials inventory equal to 20% of the next month's direct materials requirement. At the end of August the company had 1,800 pounds of direct materials in inventory. The company's production budget reports the following. Production Budget Units to produce September 4,500 October 7,200 (1) Prepare direct materials budgets for September and October. (2) Prepare direct labor budgets for September and October. (3) Prepare factory overhead budgets for September and October. November 6,100 Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare direct materials budgets for September and October. Units to produce Materials required per unit (pounds) Materials needed for production (pounds) Add: Desired ending materials inventory Total materials required (pounds) Less: Beginning materials inventory Materials to purchase (pounds) Materials cost per pound Cost of direct materials purchases MCO Leather Direct Materials Budget September $ < Required 1 0 0 October 0 $ 0 0 0 Required 2 >
Transcribed Image Text:MCO Leather manufactures leather purses. Each purse requires 2 pounds of direct materials at a cost of $4 per pound and 0.7 direct labor hour at a rate of $11 per hour. Variable overhead is budgeted at a rate of $3 per direct labor hour. Budgeted fixed overhead is $20,000 per month. The company's policy is to end each month with direct materials inventory equal to 20% of the next month's direct materials requirement. At the end of August the company had 1,800 pounds of direct materials in inventory. The company's production budget reports the following. Production Budget Units to produce September 4,500 October 7,200 (1) Prepare direct materials budgets for September and October. (2) Prepare direct labor budgets for September and October. (3) Prepare factory overhead budgets for September and October. November 6,100 Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare direct materials budgets for September and October. Units to produce Materials required per unit (pounds) Materials needed for production (pounds) Add: Desired ending materials inventory Total materials required (pounds) Less: Beginning materials inventory Materials to purchase (pounds) Materials cost per pound Cost of direct materials purchases MCO Leather Direct Materials Budget September $ < Required 1 0 0 October 0 $ 0 0 0 Required 2 >
Required 1 Required 2 Prepare direct labor budgets for September and October. (Round "DL hours required per unit" answers to one decimal place.) MCO Leather Direct Labor Budget Units to produce Direct labor hours needed Cost of direct labor Required 1 Required 2 Required 3 Direct labor hours needed Budgeted variable overhead September $ Budgeted total factory overhead 0 Required 3 October 0 $ < Required 1 Prepare factory overhead budgets for September and October. MCO Leather Factory Overhead Budget 0 $ 0 $ September Required 3 > < Required 2 0 $ October 0 $ 0 0 Required 3 >
Transcribed Image Text:Required 1 Required 2 Prepare direct labor budgets for September and October. (Round "DL hours required per unit" answers to one decimal place.) MCO Leather Direct Labor Budget Units to produce Direct labor hours needed Cost of direct labor Required 1 Required 2 Required 3 Direct labor hours needed Budgeted variable overhead September $ Budgeted total factory overhead 0 Required 3 October 0 $ < Required 1 Prepare factory overhead budgets for September and October. MCO Leather Factory Overhead Budget 0 $ 0 $ September Required 3 > < Required 2 0 $ October 0 $ 0 0 Required 3 >
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