Problem 20-1A (Algo) Manufacturing: Preparing production, materials, labor, and overhead budgets LO P1 [The following information applies to the questions displayed below.] Black Diamond Company produces snowboards. Each snowboard requires 1 pounds of carbon fiber. Management reports that 6,500 snowboards and 7,500 pounds of carbon fiber are in inventory at the beginning of the third quarter, and that 165,000 snowboards are budgeted to be sold during the third quarter. Management wants to end the third quarter with 5,000 snowboards and 5,500 pounds of carbon fiber in inventory. Carbon fiber costs $14 per pound. Each snowboard requires 0.5 hour of direct labor at $19 per hour. Variable overhead is budgeted at the rate of $9 per direct labor hour. The company budgets fixed overhead of $1,797,000 for the quarter. Problem 20-1A (Algo) Part 2 2. Prepare the direct materials budget for the third quarter. Units to produce BLACK DIAMOND COMPANY Direct Materials Budget Third Quarter Materials required per unit (pounds) Materials needed for production (pounds) Add: Desired ending materials inventory (pounds) Total materials required (pounds) Less: Beginning materials inventory (pounds) Materials to purchase (pounds) Materials cost per pound Cost of direct materials purchases
Problem 20-1A (Algo) Manufacturing: Preparing production, materials, labor, and overhead budgets LO P1 [The following information applies to the questions displayed below.] Black Diamond Company produces snowboards. Each snowboard requires 1 pounds of carbon fiber. Management reports that 6,500 snowboards and 7,500 pounds of carbon fiber are in inventory at the beginning of the third quarter, and that 165,000 snowboards are budgeted to be sold during the third quarter. Management wants to end the third quarter with 5,000 snowboards and 5,500 pounds of carbon fiber in inventory. Carbon fiber costs $14 per pound. Each snowboard requires 0.5 hour of direct labor at $19 per hour. Variable overhead is budgeted at the rate of $9 per direct labor hour. The company budgets fixed overhead of $1,797,000 for the quarter. Problem 20-1A (Algo) Part 2 2. Prepare the direct materials budget for the third quarter. Units to produce BLACK DIAMOND COMPANY Direct Materials Budget Third Quarter Materials required per unit (pounds) Materials needed for production (pounds) Add: Desired ending materials inventory (pounds) Total materials required (pounds) Less: Beginning materials inventory (pounds) Materials to purchase (pounds) Materials cost per pound Cost of direct materials purchases
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
![Problem 20-1A (Algo) Manufacturing: Preparing production, materials, labor, and overhead budgets LO
P1
[The following information applies to the questions displayed below.]
Black Diamond Company produces snowboards. Each snowboard requires 1 pounds of carbon fiber. Management reports
that 6,500 snowboards and 7,500 pounds of carbon fiber are in inventory at the beginning of the third quarter, and that
165,000 snowboards are budgeted to be sold during the third quarter. Management wants to end the third quarter with
5,000 snowboards and 5,500 pounds of carbon fiber in inventory. Carbon fiber costs $14 per pound. Each snowboard
requires 0.5 hour of direct labor at $19 per hour. Variable overhead is budgeted at the rate of $9 per direct labor hour. The
company budgets fixed overhead of $1,797,000 for the quarter.
Problem 20-1A (Algo) Part 2
2. Prepare the direct materials budget for the third quarter.
Units to produce
BLACK DIAMOND COMPANY
Direct Materials Budget
Third Quarter
Materials required per unit (pounds)
Materials needed for production (pounds)
Add: Desired ending materials inventory (pounds)
Total materials required (pounds)
Less: Beginning materials inventory (pounds)
Materials to purchase (pounds)
Materials cost per pound
Cost of direct materials purchases](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe18c4c3e-fff6-4ff0-8265-a5151c1bba12%2F68e7aa3e-ba99-48d6-8e48-e619afcf1196%2Fgjfyoxh_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Problem 20-1A (Algo) Manufacturing: Preparing production, materials, labor, and overhead budgets LO
P1
[The following information applies to the questions displayed below.]
Black Diamond Company produces snowboards. Each snowboard requires 1 pounds of carbon fiber. Management reports
that 6,500 snowboards and 7,500 pounds of carbon fiber are in inventory at the beginning of the third quarter, and that
165,000 snowboards are budgeted to be sold during the third quarter. Management wants to end the third quarter with
5,000 snowboards and 5,500 pounds of carbon fiber in inventory. Carbon fiber costs $14 per pound. Each snowboard
requires 0.5 hour of direct labor at $19 per hour. Variable overhead is budgeted at the rate of $9 per direct labor hour. The
company budgets fixed overhead of $1,797,000 for the quarter.
Problem 20-1A (Algo) Part 2
2. Prepare the direct materials budget for the third quarter.
Units to produce
BLACK DIAMOND COMPANY
Direct Materials Budget
Third Quarter
Materials required per unit (pounds)
Materials needed for production (pounds)
Add: Desired ending materials inventory (pounds)
Total materials required (pounds)
Less: Beginning materials inventory (pounds)
Materials to purchase (pounds)
Materials cost per pound
Cost of direct materials purchases
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