The production department of Hareston Company has submitted the following forecast of units to be produced by quarter for the upcoming fiscal year: 1st Quarter 2nd Quarter 3rd Quarter Units to be produced 7,500 8,500 6,500 Total needs (kilograms) 4th Quarter 5,500 In addition, the beginning raw materials inventory for the first quarter is budgeted to be 1,650 kilograms and the beginning accounts payable for the first quarter are budgeted to be $3,190. Each unit requires 2.5 kilograms of raw material that costs $1.90 per kilogram. Management desires to end each quarter with an inventory of raw materials equal to 10% of the following quarter's production needs. The desired ending inventory for the fourth quarter is 1,875 kilograms. Management plans to pay for 80% of raw material purchases in the quarter acquired and 20% in the following quarter. Each unit requires 0.6 direct labour-hours, and direct labour-hour workers are paid $16.5 per hour. Required: 1. Prepare the company's direct materials budget. (Round your answer to the nearest whole dollar amount.) HARESTON COMPANY Direct Materials Budget 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Year 2. Prepare the company's direct labour budget for the upcoming fiscal year, assuming that the direct labour workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced. (Do not round intermediate calculations.)
The production department of Hareston Company has submitted the following forecast of units to be produced by quarter for the upcoming fiscal year: 1st Quarter 2nd Quarter 3rd Quarter Units to be produced 7,500 8,500 6,500 Total needs (kilograms) 4th Quarter 5,500 In addition, the beginning raw materials inventory for the first quarter is budgeted to be 1,650 kilograms and the beginning accounts payable for the first quarter are budgeted to be $3,190. Each unit requires 2.5 kilograms of raw material that costs $1.90 per kilogram. Management desires to end each quarter with an inventory of raw materials equal to 10% of the following quarter's production needs. The desired ending inventory for the fourth quarter is 1,875 kilograms. Management plans to pay for 80% of raw material purchases in the quarter acquired and 20% in the following quarter. Each unit requires 0.6 direct labour-hours, and direct labour-hour workers are paid $16.5 per hour. Required: 1. Prepare the company's direct materials budget. (Round your answer to the nearest whole dollar amount.) HARESTON COMPANY Direct Materials Budget 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Year 2. Prepare the company's direct labour budget for the upcoming fiscal year, assuming that the direct labour workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced. (Do not round intermediate calculations.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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.
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Transcribed Image Text:The production department of Hareston Company has submitted the following forecast of units to be produced by quarter for the
upcoming fiscal year:
1st Quarter 2nd Quarter 3rd Quarter 4th Quarter
Units to be produced 7,500
8,500
Total needs (kilograms)
In addition, the beginning raw materials inventory for the first quarter is budgeted to be 1,650 kilograms and the beginning accounts
payable for the first quarter are budgeted to be $3,190.
6,500
Each unit requires 2.5 kilograms of raw material that costs $1.90 per kilogram. Management desires to end each quarter with an
inventory of raw materials equal to 10% of the following quarter's production needs. The desired ending inventory for the fourth
quarter is 1,875 kilograms. Management plans to pay for 80% of raw material purchases in the quarter acquired and 20% in the
following quarter. Each unit requires 0.6 direct labour-hours, and direct labour-hour workers are paid $16.5 per hour.
Required:
1. Prepare the company's direct materials budget. (Round your answer to the nearest whole dollar amount.)
Total direct labour-hours needed
Total direct labour cost
5,500
1st Quarter
HARESTON COMPANY
Direct Materials Budget
1st Quarter 2nd Quarter
HARESTON COMPANY
Direct Labour Budget
3rd Quarter
2. Prepare the company's direct labour budget for the upcoming fiscal year, assuming that the direct labour workforce is adjusted each
quarter to match the number of hours required to produce the forecasted number of units produced. (Do not round intermediate
calculations.)
4th Quarter
2nd Quarter 3rd Quarter 4th Quarter
Year
Year
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