Required information Skip to question [The following information applies to the questions displayed below.] Morganton Company makes one product and it provided the following information to help prepare the master budget: The budgeted selling price per unit is $60. Budgeted unit sales for June, July, August, and September are 8, 600, 17,000, 19,000, and 20,000 units, respectively. All sales are on credit. Thirty percent of credit sales are collected in the month of the sale and 70% in the following month. The ending finished goods inventory equals 25% of the following month's unit sales. The ending raw materials inventory equals 10% of the following month's raw materials production needs. Each unit of finished goods requires 5 pounds of raw materials. The raw materials cost $2.40 per pound. Thirty five percent of raw materials purchases are paid for in the month of purchase and 65% in the following month. The direct labor wage rate is $14 per hour. Each unit of finished goods requires two direct labor - hours. The variable selling and administrative expense per unit sold is $1.80. The fixed selling and administrative expense per month is $67,000. 8. If 96, 250 pounds of raw materials are needed to meet production in August, what is the estimated
Required information Skip to question [The following information applies to the questions displayed below.] Morganton Company makes one product and it provided the following information to help prepare the master budget: The budgeted selling price per unit is $60. Budgeted unit sales for June, July, August, and September are 8, 600, 17,000, 19,000, and 20,000 units, respectively. All sales are on credit. Thirty percent of credit sales are collected in the month of the sale and 70% in the following month. The ending finished goods inventory equals 25% of the following month's unit sales. The ending raw materials inventory equals 10% of the following month's raw materials production needs. Each unit of finished goods requires 5 pounds of raw materials. The raw materials cost $2.40 per pound. Thirty five percent of raw materials purchases are paid for in the month of purchase and 65% in the following month. The direct labor wage rate is $14 per hour. Each unit of finished goods requires two direct labor - hours. The variable selling and administrative expense per unit sold is $1.80. The fixed selling and administrative expense per month is $67,000. 8. If 96, 250 pounds of raw materials are needed to meet production in August, what is the estimated
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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
![Required information Skip to question [The following information applies to the questions
displayed below.] Morganton Company makes one product and it provided the following
information to help prepare the master budget: The budgeted selling price per unit is $60.
Budgeted unit sales for June, July, August, and September are 8, 600, 17,000, 19,000, and
20,000 units, respectively. All sales are on credit. Thirty percent of credit sales are collected in
the month of the sale and 70% in the following month. The ending finished goods inventory
equals 25% of the following month's unit sales. The ending raw materials inventory equals
10% of the following month's raw materials production needs. Each unit of finished goods
requires 5 pounds of raw materials. The raw materials cost $2.40 per pound. Thirty five
percent of raw materials purchases are paid for in the month of purchase and 65% in the
following month. The direct labor wage rate is $14 per hour. Each unit of finished goods
requires two direct labor - hours. The variable selling and administrative expense per unit sold
is $1.80. The fixed selling and administrative expense per month is $67,000. 8. If 96,250
pounds of raw materials are needed to meet production in August, what is the estimated
accounts payable balance at the end of July?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F36e78a2d-501b-4036-84f8-e9d33c954baf%2F8e374348-b208-480f-8703-becb580f8dfd%2F59enjc3_processed.png&w=3840&q=75)
Transcribed Image Text:Required information Skip to question [The following information applies to the questions
displayed below.] Morganton Company makes one product and it provided the following
information to help prepare the master budget: The budgeted selling price per unit is $60.
Budgeted unit sales for June, July, August, and September are 8, 600, 17,000, 19,000, and
20,000 units, respectively. All sales are on credit. Thirty percent of credit sales are collected in
the month of the sale and 70% in the following month. The ending finished goods inventory
equals 25% of the following month's unit sales. The ending raw materials inventory equals
10% of the following month's raw materials production needs. Each unit of finished goods
requires 5 pounds of raw materials. The raw materials cost $2.40 per pound. Thirty five
percent of raw materials purchases are paid for in the month of purchase and 65% in the
following month. The direct labor wage rate is $14 per hour. Each unit of finished goods
requires two direct labor - hours. The variable selling and administrative expense per unit sold
is $1.80. The fixed selling and administrative expense per month is $67,000. 8. If 96,250
pounds of raw materials are needed to meet production in August, what is the estimated
accounts payable balance at the end of July?
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