Roseman Sports, Inc. manufactures two models of speakers, Tremble and Thunder. Based on the following production and sales date for May, prepare a SALES BUDGET. Estimated inventory(units), May 1 TREMBLE THUNDER 2,000 2,000 Desired inventory(units), May 31 1,000 1,000 Expected Sales Volume (units) East Region West Region Unit sales price 20,000 10,000 10,000 5,000 $50 $100

Roseman Sports, Inc. manufactures two models of speakers, Tremble and Thunder. Based on the following production and sales date for May, prepare a SALES BUDGET. Estimated inventory(units), May 1 TREMBLE THUNDER 2,000 2,000 Desired inventory(units), May 31 1,000 1,000 Expected Sales Volume (units) East Region West Region Unit sales price 20,000 10,000 10,000 5,000 $50 $100

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter9: Profit Planning And Flexible Budgets

Section: Chapter Questions

Problem 66P: Operating Budget, Comprehensive Analysis Allison Manufacturing produces a subassembly used in the...

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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.
Prepare a cost of goods sold budget for the Crest Hills Manufacturing Co. for the year ended December 31, 2016, from the following estimates. Inventories of production units: Direct materials purchased during the year, 854,000; beginning inventory of direct materials, 31,000; and ending inventory of direct materials, 26,000. Totals from other budgets included:
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.
Production budget Healthy Measures Inc. produces a Bath and Gym version of its popular electronic scale. The anticipated unit sales for the scales by sales region are as follows: The finished goods inventory estimated for March 1, for the Bath and Gym scale models is 11,800 and 8,100 units, respectively. The desired finished goods inventory for March 31 for the Bath and Gym scale models is 15,000 and 7,500 units, respectively. Prepare a production budget for the Bath and Gym scales for the month ended March 31.
Sales and production budgets Ultimate Audio Company manufactures two models of speakers. U500 and S1000. Based on the following production and sales data for June, prepare (a) a sales budget and (b) a production budget.
Blue Book printing is budgeting sales of 25,000 units and already has 5,000 in beginning inventory. How many units must be produced to also meet the 7,000 units required in ending inventory?
The Sales Department of Minimus Inc. has forecast sales for May 2016 to be 40,000 units. Additional information follows: Materials used in production: Direct labor hours required in production: Prepare the following: a. A production budget for May. b. A direct materials budget for May. c. A direct labor budget for May.
Triple B, Inc. manufactures two models of speakers, Rumble and Thunder. Based on the following production and sales dates for April, prepare (1) a sales budget and (2) a production budget. RUMBLE Estimated inventory (units), April 1 1,000 Desired inventory (units), April 30 500 THUNDER 500 100 Expected sales volume (units) East Region 10,000 20,000 West Region 5,000 10,000 Unit sales price $ 100 $ 50
Sonic Inc. manufacturers two models of speakers, Rumble and Thunder. Based on the following production and sales data for June, prepare (a) a sales budget and (b) a production budget: Rumble Thunder estimated inventory (units), June 1 280 76 Desired inventory (units), June 30 322 66 Expected sales volume (units): Midwest Region 3,500 3,900 South Region 5,700 4,950 Unit sales price $125 $210 Refer to the pictures for the sales budget and production budget template.
Microfix Company manufactures two models of Television, AR30 and AR33. Based on the following production data for April of the current year, prepare a production budget for April. AR30 AR33 Estimated inventory (units), April 1 2,500 3,700 Desired inventory (units), April 30 3,700 3,700 Expected sales volume (units): Eastern zone 8,200 11,500 Midwest zone 13,000 17,500 Western zone 7,300 9,100 Microfix Company Production Budget For Month Ending April 30, 20XX AR30 (units) AT33 (units) Sales Plus desired ending inventory, April 30, 20XX X Total Less estimated beginning inventory, April 1, 20XX X Total production X
Sales and Production Budgets Bass Audio Company manufactures two models of speakers, U500 and S1000. Based on the following production and sales data for June. U500 s1000 Estimated inventory (units), June 1 12,500 5,000 Desired inventory (units), June 30 15,000 7,500 Expected sales volume (units): Northeast Region 70,000 50,000 Southwest Region 80,000 62,500 Unit sales price $45 $80 a. Prepare a sales budget. Enter all amounts as positive numbers. BASS AUDIO COMPANY Sales Budget For the Month Ending June 30 Unit Sales Volume Unit Selling Price Total Sales Product and Area Model U500: Northeast Region Southwest Region Total
6. Sonic Inc. manufactures two models of speakers, Rumble and Thunder. Based on the following production and sales data for June, prepare (a) a sales budget and (b) a production budget. Rumble Thunder Estimated inventory (units), June 1 262 72 Desired inventory (units), June 30 301 63 Expected sales volume (units): East Region 3,550 4,000 West Region 5,050 4,400 Unit sales price $125 $225 a. Prepare a sales budget.