The SK Industries, Inc. manufactures and sells two products, Accel Active and Accel Regular. In September 2018, SK Industries Budget Department gathered the following data in order to prepare budgets for 2019: 2019 Projected Sales Product Units Price Accel Active 45,000 s225 Accel Regular 75,000SI Expected Target Inventories Product January 1, 2019 December 31, 2019 Accel Active 9,000 12,000 Accel Regular 17,000 25,000 The following direct materials are expected to be used in the two products: |Material Used per Unit Direct Material Unit Accel Active Accel Regular One Two pound pound 4 2 Three pound 2 Projected data for 2019 with respeet to direct materials are as follows: Direct Material Expected Purchase PriceExpected Inventories Target Inventories (January 1, 2019) (December 31, 2019) One SIs 27,000 lb 35,000 lb Two $7 30,000 Ib 35,000 lb Three $4 4,000 lb 7,000 lb Projected direct labor requirements and rates for 2019 are as follows: Product Accel Active Hours Per Unit Rate Per Hour SI8 Accel Regular SI5 Manufacturing overhead is allocated at the rate of $22 per direct manufacturing labor-hour. Required: Based on the preceding projections and budget requirements for Accel Active and Accel Regular, prepare the following budgets for 2019: 5. Direct manufacturing labor budget (in dollars) 6. Direct manufacturing overhead budget (in dollars) 7. Budgeted finished goods inventory at December 31, 2019 (in dollars)
The SK Industries, Inc. manufactures and sells two products, Accel Active and Accel Regular. In September 2018, SK Industries Budget Department gathered the following data in order to prepare budgets for 2019: 2019 Projected Sales Product Units Price Accel Active 45,000 s225 Accel Regular 75,000SI Expected Target Inventories Product January 1, 2019 December 31, 2019 Accel Active 9,000 12,000 Accel Regular 17,000 25,000 The following direct materials are expected to be used in the two products: |Material Used per Unit Direct Material Unit Accel Active Accel Regular One Two pound pound 4 2 Three pound 2 Projected data for 2019 with respeet to direct materials are as follows: Direct Material Expected Purchase PriceExpected Inventories Target Inventories (January 1, 2019) (December 31, 2019) One SIs 27,000 lb 35,000 lb Two $7 30,000 Ib 35,000 lb Three $4 4,000 lb 7,000 lb Projected direct labor requirements and rates for 2019 are as follows: Product Accel Active Hours Per Unit Rate Per Hour SI8 Accel Regular SI5 Manufacturing overhead is allocated at the rate of $22 per direct manufacturing labor-hour. Required: Based on the preceding projections and budget requirements for Accel Active and Accel Regular, prepare the following budgets for 2019: 5. Direct manufacturing labor budget (in dollars) 6. Direct manufacturing overhead budget (in dollars) 7. Budgeted finished goods inventory at December 31, 2019 (in dollars)
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.
Question
Transcribed Image Text:The SK Industries, Inc. manufactures and sells two products, Accel Active and Accel Regular. In
September 2018, SK Industries Budget Department gathered the following data in order to
prepare budgets for 2019:
2019 Projected Sales
Product
Accel Active 45,000|s225
|Units Price
Accel Regular 75,000 S1s5
Expected Target Inventories
Product
January 1, 2019 December 31, 2019
Accel Active
9,000
12,000
Accel Regular
17,000
25,000
The following direct materials are expected to be used in the two products:
Material Used per Unit
Direct Material Unit Accel Active Accel Regular
pound
One
6.
Two
pound
4
2
Three
pound
Projected data for 2019 with respect to direct materials are as follows:
Direct Material Expected Purchase PriceExpected Inventories Target Inventories
(January 1, 2019) (December 31, 2019)
One
$15
27,000 lb
35,000 lb
Two
S7
30,000 lb
35,000 lb
Three
$4
4,000 lb
7,000 lb
Projected direct labor requirements and rates for 2019 are as follows:
Product
Hours Per Unit Rate Per Hour
Accel Active
4
SI8
Accel Regular
S15
3
Manufacturing overhead is allocated at the rate of $22 per direct manufacturing labor-hour.
Required: Based on the preceding projections and budget requirements for Accel Active and
Accel Regular, prepare the following budgets for 2019:
nars)
5. Direct manufacturing labor budget (in dollars)
6. Direct manufacturing overhead budget (in dollars)
7. Budgeted finished goods inventory at December 31, 2019 (in dollars)
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