ppp E7-5Preparing cost of goods sold budgetPrepare a cost of goods sold budget for MacLaren ManufacturingInc. for the year ended December 31, 2016, from the following esti-mates. Inventories of production units:FinishedGoodsJanuary 1, 2016.$13,900December 31, 2016.24,200Direct materials purchased during the year, $548,000; begin-ning inventory of direct materials, $36,000; and ending inventoryof direct materials, $23,000. Totals from other budgets included:Direct labor cost.Total factory overhead costs$395,500481,000

The cost of goods sold measures the direct cost of producing the goods.Which includes the direct…

Answered: Preparing cost of goods sold budget

Business

Accounting

Preparing cost of goods sold budget

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter7: The Master Budget And Flexible Budgeting

Section: Chapter Questions

Problem 5E: Prepare a cost of goods sold budget for MacLaren Manufacturing Inc. for the year ended December 31,...

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Concept explainers

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.

Question

ppp

E7-5
Preparing cost of goods sold budget
Prepare a cost of goods sold budget for MacLaren Manufacturing
Inc. for the year ended December 31, 2016, from the following esti-
mates. Inventories of production units:
Finished
Goods
January 1, 2016.
$13,900
December 31, 2016.
24,200
Direct materials purchased during the year, $548,000; begin-
ning inventory of direct materials, $36,000; and ending inventory
of direct materials, $23,000. Totals from other budgets included:
Direct labor cost.
Total factory overhead costs
$395,500
481,000

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