Question 1 TinyTom makes one product, which sells for $70 each, and prepares functional budgets on a monthly basis. For the first three months of 2021, the following figures are proposed: Sales January 10,000 units 14,000 units February March 12,000 units April 10,000 A closing stock of 10% of the next month's sales is required, the forecast sales for April is 10,000 units. The standard material cost of one unit of finished product is: Material X 4 units at $2 per unit Material Y 8 units at $3 per unit 2 unit at $5 per unit Material Z The standard direct labour cost of one unit of finished product is: Department A 4 hours at $5 per hour Department B 4 hours at $5 per hour 2 hours at $4 per hour Department C Material Material X Y Z 75,000 80,000 15,000 Opening Stock Closing Stock 60,000 75,000 12,500 Required: 1) Calculate the standard prime cost of one unit of finished product. ii) Calculate the Sales Budget for each of months. iii) Calculate the Production Budget for each of months.

Each unit requires direct labor of 4.1 hours. The labor rate is $13.75 per hour and next years production is estimated at 75,000 units. What is the amount to be included in next years direct labor budget?

The sales department of Macro Manufacturing Co. has forecast sales for its single product to be 20,000 units for June, with three-quarters of the sales expected in the East region and one-fourth in the West region. The budgeted selling price is 25 per unit. The desired ending inventory on June 30 is 2,000 units, and the expected beginning inventory on June 1 is 3,000 units. Prepare the following: a. A sales budget for June. b. A production budget for June.

Refer to Cornerstone Exercises 2.2 and 2.3. Next year, Pietro expects to produce 50,000 units and sell 49,300 units at a price of 12.50 each. Beginning inventory of finished goods is 42,500, and ending inventory of finished goods is expected to be 34,000. Total selling expense is projected at 26,000, and total administrative expense is projected at 134,000. Required: 1. Prepare an income statement in good form. Be sure to include the percent of sales column. 2. What if the cost of goods sold percentage for the past few years was 65 percent? Explain how management might react.

Operating Budget, Comprehensive Analysis Allison Manufacturing produces a subassembly used in the production of jet aircraft engines. The assembly is sold to engine manufacturers and aircraft maintenance facilities. Projected sales in units for the coming 5 months follow: The following data pertain to production policies and manufacturing specifications followed by Allison Manufacturing: a. Finished goods inventory on January 1 is 32,000 units, each costing 166.06. The desired ending inventory for each month is 80% of the next months sales. b. The data on materials used are as follows: Inventory policy dictates that sufficient materials be on hand at the end of the month to produce 50% of the next months production needs. This is exactly the amount of material on hand on December 31 of the prior year. c. The direct labor used per unit of output is 3 hours. The average direct labor cost per hour is 14.25. d. Overhead each month is estimated using a flexible budget formula. (Note: Activity is measured in direct labor hours.) e. Monthly selling and administrative expenses are also estimated using a flexible budgeting formula. (Note: Activity is measured in units sold.) f. The unit selling price of the subassembly is 205. g. All sales and purchases are for cash. The cash balance on January 1 equals 400,000. The firm requires a minimum ending balance of 50,000. If the firm develops a cash shortage by the end of the month, sufficient cash is borrowed to cover the shortage. Any cash borrowed is repaid at the end of the quarter, as is the interest due (cash borrowed at the end of the quarter is repaid at the end of the following quarter). The interest rate is 12% per annum. No money is owed at the beginning of January. Required: 1. Prepare a monthly operating budget for the first quarter with the following schedules. (Note: Assume that there is no change in work-in-process inventories.) a. Sales budget b. Production budget c. Direct materials purchases budget d. Direct labor budget e. Overhead budget f. Selling and administrative expenses budget g. Ending finished goods inventory budget h. Cost of goods sold budget i. Budgeted income statement j. Cash budget 2. CONCEPTUAL CONNECTION Form a group with two or three other students. Locate a manufacturing plant in your community that has headquarters elsewhere. Interview the controller for the plant regarding the master budgeting process. Ask when the process starts each year, what schedules and budgets are prepared at the plant level, how the controller forecasts the amounts, and how those schedules and budgets fit in with the overall corporate budget. Is the budgetary process participative? Also, find out how budgets are used for performance analysis. Write a summary of the interview.

One Device makes universal remote controls and expects to sell 500 units in January, 800 in February, 450 in March, 550 in April, and 600 in May. The required ending inventory is 20% of the next months sales. Prepare a production budget for the first four months of the year.

Play-Disc makes Frisbee-type plastic discs. Each 12-inch diameter plastic disc has the following manufacturing costs: For the coming year, Play-Disc expects to make 300,000 plastic discs, and to sell 285,000 of them. Budgeted beginning inventory in units is 16,000 with unit cost of 4.75. (There are no beginning or ending inventories of work in process.) Required: 1. Prepare an ending finished goods inventory budget for Play-Disc for the coming year. 2. What if sales increased to 290,000 discs? How would that affect the ending finished goods inventory budget? Calculate the value of budgeted ending finished goods inventory.

Vaughan company estimates that unit sales will be 10,500 in quarter 1; 11,400 in quarter 2; 13,400 in quarter 3; and 18600 in quarter 4. management wnta to have an ending finished goods inventory equal to 21% of the next quarter's expected unit sales. Prepare a production budget by quarters for the first six months of 2022

Blossom Company estimates that unit sales will be 8,000 in quarter 1, 11,200 in quarter 2, 12,000 in quarter 3, and 14,400 in quarter 4. The sales price is $70 per unit. Management desires to have an ending finished goods inventory equal to 25% of the next quarter's expected unit sales. Prepare a production budget by quarters for the first 6 months of 2022. Expected Unit Sales Add V: Desired Ending Finished Goods Inventory Total Required Units Less V: Beginning Finished Goods Inventory Required Production Units BLOSSOM COMPANY Production Budget For the Six Months Ending June 30, 2022 V 1 8000 2800 10800 Quarter D 11200 3000 14200 Six Months

Paige Company estimates that unit sales will be 10,000 in quarter 1, 14,000 in quarter 2, 15,000 in quarter 3, and 18,000 in quarter 4. Management desires to have an ending finished goods inventory equal to 25% of the next quarter’s expected unit sales.Prepare a production budget by quarters for the first 6 months of 2020. PAIGE COMPANYProduction Budgetchoose the accounting period                                                              Quarter     1   2   Six Months select an opening name                                                            enter a number of units   enter a number of units     select between addition and deduction                                                           : select an item                                                            enter a number of units   enter a number of units     select a summarizing line                                                            enter a subtotal of the two previous…