Operation costing. The Carter Furniture Company needs to determine the cost of two work orders for December 2017. Work Order 1200A is for 250 painted, unassembled chests and Work Order 1250A is for 400 stained, assembled chests. The following information pertains to these two work orders: Work Order 1200A 250 Work Order 1250A Number of chests Operations 1. Cutting 2. Painting 3. Staining 4. Assembling 6. Packaging 400 Use Use Use Do not use Do not use Use Do not use Use Use Use Selected budget information for December follows: Unassembled Chests Assembled Chests Total 1,500 $180,000 Chests 2,300 $232,000 800 $52,000 Direct materials costs Budgeted conversion costs for each operation for December follow: Cutting Painting Staining Assembling Packaging $41,400 6,400 24,000 33,000 11,500
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Using budgeted number of chests as the denominator, calculate the budgeted conversion-cost rates for each operation
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