Required Informatlon The Foundational 15 (Algo) [LO8-2, LO8-3, LO8-4, LO8-5, LO8-7, LO8-9, L08-10] [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 a. The budgeted selling price per unit is $60. Budgeted unit sales for June, July, August, and September are 8,300, 14,000, 16,000, and 17,000 units, respectively. All sales are on credit. b. Forty percent of credit sales are collected in the month of the sale and 60% in the following month. c. The ending finished goods inventory equals 25% of the following month's unit sales. d. 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 $2.00 per pound. e. Forty percent of raw materials purchases are pald for in the month of purchase and 60% In the following month. f. The direct labor wage rate is $15 per hour. Each unit of finished goods requires two direct labor-hours. g. The varlable selling and administrative expense per unit sold is $1.50. The fixed selling and administrative expense per month is $64,000.
Required Informatlon The Foundational 15 (Algo) [LO8-2, LO8-3, LO8-4, LO8-5, LO8-7, LO8-9, L08-10] [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 a. The budgeted selling price per unit is $60. Budgeted unit sales for June, July, August, and September are 8,300, 14,000, 16,000, and 17,000 units, respectively. All sales are on credit. b. Forty percent of credit sales are collected in the month of the sale and 60% in the following month. c. The ending finished goods inventory equals 25% of the following month's unit sales. d. 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 $2.00 per pound. e. Forty percent of raw materials purchases are pald for in the month of purchase and 60% In the following month. f. The direct labor wage rate is $15 per hour. Each unit of finished goods requires two direct labor-hours. g. The varlable selling and administrative expense per unit sold is $1.50. The fixed selling and administrative expense per month is $64,000.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Here's the transcribed text and explanation:
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**Required Information**
**The Foundational 15 (Algo) [LO8-2, LO8-3, LO8-4, LO8-5, LO8-7, LO8-9, LO8-10]**
*[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:
a. The budgeted selling price per unit is $60. Budgeted unit sales for June, July, August, and September are 8,300, 14,000, 16,000, and 17,000 units, respectively. All sales are on credit.
b. Forty percent of credit sales are collected in the month of the sale and 60% in the following month.
c. The ending finished goods inventory equals 25% of the following month’s unit sales.
d. 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 $2.00 per pound.
e. Forty percent of raw materials purchases are paid for in the month of purchase and 60% in the following month.
f. The direct labor wage rate is $15 per hour. Each unit of finished goods requires two direct labor-hours.
g. The variable selling and administrative expense per unit sold is $1.50. The fixed selling and administrative expense per month is $64,000.
**Foundational 8-9 (Algo)**
9. If 81,250 pounds of raw materials are needed to meet production in August, what is the estimated raw materials inventory balance at the end of July?
| Raw material inventory balance | _____ |
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This excerpt provides detailed budgeting information for Morganton Company, with specific figures for unit sales, collection of sales, inventory requirements, material costs, and labor rates. The question focuses on calculating the raw materials inventory balance based on provided production needs.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8f61e626-7d33-482f-bf18-423884fdaa73%2F3d993cf8-a6e8-44f2-82a1-e26dcba86334%2F42efye5_processed.png&w=3840&q=75)
Transcribed Image Text:Here's the transcribed text and explanation:
---
**Required Information**
**The Foundational 15 (Algo) [LO8-2, LO8-3, LO8-4, LO8-5, LO8-7, LO8-9, LO8-10]**
*[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:
a. The budgeted selling price per unit is $60. Budgeted unit sales for June, July, August, and September are 8,300, 14,000, 16,000, and 17,000 units, respectively. All sales are on credit.
b. Forty percent of credit sales are collected in the month of the sale and 60% in the following month.
c. The ending finished goods inventory equals 25% of the following month’s unit sales.
d. 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 $2.00 per pound.
e. Forty percent of raw materials purchases are paid for in the month of purchase and 60% in the following month.
f. The direct labor wage rate is $15 per hour. Each unit of finished goods requires two direct labor-hours.
g. The variable selling and administrative expense per unit sold is $1.50. The fixed selling and administrative expense per month is $64,000.
**Foundational 8-9 (Algo)**
9. If 81,250 pounds of raw materials are needed to meet production in August, what is the estimated raw materials inventory balance at the end of July?
| Raw material inventory balance | _____ |
---
This excerpt provides detailed budgeting information for Morganton Company, with specific figures for unit sales, collection of sales, inventory requirements, material costs, and labor rates. The question focuses on calculating the raw materials inventory balance based on provided production needs.
Transcribed Image Text:**Question 13:**
If we assume that there is no fixed manufacturing overhead and the variable manufacturing overhead is $6 per direct labor-hour, what is the estimated cost of goods sold and gross margin for July?
| | |
|---------------------------|-----------------------|
| Estimated cost of goods sold | |
| Estimated gross margin | |
**Explanation of Diagram:**
The diagram consists of a simple table with two rows and two columns. The left column lists the items to be calculated: "Estimated cost of goods sold" and "Estimated gross margin." The right column is left blank for filling in the calculated values.
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