Pasadena Candle Inc. budgeted production of 785,000 candles for the year. Each candle requires molding. Assume that six minutes are required to mold each candle. If molding labor costs $18 per hour, determine the direct labor cost budget for the year. Wax is required to produce a candle. Assume 487,125 pounds of material will be purchased during the year. If candle wax costs $1.24 per pound, determine the direct materials purchases for the year. Prepare a cost of goods sold budget for Pasadena Candle Inc. using the information above. Assume the estimated inventories on January 1 for finished goods and work in process were $200,000 and $41,250, respectively and direct materials wax inventory of 16,000 pounds. Also assume the desired inventories on December 31 for finished goods and work in process were $120,000 and $28,500, respectively and direct materials wax inventory of 12,500 pounds. Factory overhead was budgeted at $300,000. For those boxes in which you must enter subtracted or negative numbers use a minus sign. Pasadena Candle Inc. Cost of Goods Sold Budget For the Year Ending December 31 Finished goods inventory, January 1 $ Work in process inventory, January 1 $ Direct materials: Direct materials inventory, January 1 $ Direct materials purchases Cost of direct materials available for use $ Direct materials inventory, December 31 Cost of direct materials placed in production $ Direct labor Factory overhead Total manufacturing costs Total work in process during period $ Work in process inventory, December 31 Cost of goods manufactured Cost of finished goods available for sale $ Finished goods inventory, December 31 Cost of goods sold $
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.
Cost of goods sold budget
Pasadena Candle Inc. budgeted production of 785,000 candles for the year. Each candle requires molding. Assume that six minutes are required to mold each candle. If molding labor costs $18 per hour, determine the direct labor cost budget for the year. Wax is required to produce a candle. Assume 487,125 pounds of material will be purchased during the year. If candle wax costs $1.24 per pound, determine the direct materials purchases for the year.
Prepare a cost of goods sold budget for Pasadena Candle Inc. using the information above. Assume the estimated inventories on January 1 for finished goods and work in process were $200,000 and $41,250, respectively and direct materials wax inventory of 16,000 pounds. Also assume the desired inventories on December 31 for finished goods and work in process were $120,000 and $28,500, respectively and direct materials wax inventory of 12,500 pounds. Factory overhead was budgeted at $300,000. For those boxes in which you must enter subtracted or negative numbers use a minus sign.
| Pasadena Candle Inc. | |||
| Cost of Goods Sold Budget | |||
| For the Year Ending December 31 | |||
| Finished goods inventory, January 1 | $ | ||
| Work in process inventory, January 1 | $ | ||
| Direct materials: | |||
| Direct materials inventory, January 1 | $ | ||
| Direct materials purchases | |||
| Cost of direct materials available for use | $ | ||
| Direct materials inventory, December 31 | |||
| Cost of direct materials placed in production | $ | ||
| Direct labor | |||
| Factory overhead | |||
| Total |
|||
| Total work in process during period | $ | ||
| Work in process inventory, December 31 | |||
| Cost of goods manufactured | |||
| Cost of finished goods available for sale | $ | ||
| Finished goods inventory, December 31 | |||
| Cost of goods sold | $ |
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