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ong Company is well known for its high-quality men's shoes. It manufactures all of its products in regio h America, trying to source DM locally when possible. Managers in the production area of one of its pl ext year's first-quarter budgets to ensure they'll have the necessary resources available. s are expected to be steady, with 3,400 pairs of shoes (one pair is one unit) budgeted in January. Februa ipated sales volume of 3,800 units each, while April will be down slightly to 3,300 units. In order to pr y requires 15% of the following month's sales be held in ending inventory for all of its shoes. This polic ember 31 of this year. Additional DL and MOH information is as follows. ndard DL time 0.5 hours per unit

ong Company is well known for its high-quality men's shoes. It manufactures all of its products in regio h America, trying to source DM locally when possible. Managers in the production area of one of its pl ext year's first-quarter budgets to ensure they'll have the necessary resources available. s are expected to be steady, with 3,400 pairs of shoes (one pair is one unit) budgeted in January. Februa ipated sales volume of 3,800 units each, while April will be down slightly to 3,300 units. In order to pr y requires 15% of the following month's sales be held in ending inventory for all of its shoes. This polic ember 31 of this year. Additional DL and MOH information is as follows. ndard DL time 0.5 hours per unit

FINANCIAL ACCOUNTING
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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Skysong Company is well known for its high-quality men's shoes. It manufactures all of its products in regional facilities throughout North America, trying to source DM locally when possible. Managers in the production area of one of its plants are beginning to work on next year's first-quarter budgets to ensure they'll have the necessary resources available. Sales are expected to be steady, with 3,400 pairs of shoes (one pair is one unit) budgeted in January. February and March have anticipated sales volume of 3,800 units each, while April will be down slightly to 3,300 units. In order to prevent stock-outs, Skysong's policy requires 15% of the following month's sales be held in ending inventory for all of its shoes. This policy is expected to be met on December 31 of this year. Additional DL and MOH information is as follows. Standard DL time DL rate Variable MOH rate Fixed MOH costs Supervisor salaries Depreciation on plant assets Insurance and taxes (a) 0.5 $13.00 $1.40 hours per unit per DL hour per DL hour $4,500 per month $6,500 per month $3,400 per month Prepare Skysong's production budget for quarter 1 for this facility.
Transcribed Image Text:Skysong Company is well known for its high-quality men's shoes. It manufactures all of its products in regional facilities throughout North America, trying to source DM locally when possible. Managers in the production area of one of its plants are beginning to work on next year's first-quarter budgets to ensure they'll have the necessary resources available. Sales are expected to be steady, with 3,400 pairs of shoes (one pair is one unit) budgeted in January. February and March have anticipated sales volume of 3,800 units each, while April will be down slightly to 3,300 units. In order to prevent stock-outs, Skysong's policy requires 15% of the following month's sales be held in ending inventory for all of its shoes. This policy is expected to be met on December 31 of this year. Additional DL and MOH information is as follows. Standard DL time DL rate Variable MOH rate Fixed MOH costs Supervisor salaries Depreciation on plant assets Insurance and taxes (a) 0.5 $13.00 $1.40 hours per unit per DL hour per DL hour $4,500 per month $6,500 per month $3,400 per month Prepare Skysong's production budget for quarter 1 for this facility.
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