Wesley Power Tools manufactures a wide variety of tools and accessories. One of its more popular items is a cordless power handisaw. Each handisaw sells for $50. Wesley expects the following unit sales: January February 2, 000 2, 500 3, 100 2, 900 2, 200 March April Мay Wesley's ending finished goods inventory policy is 20 percent of the next month's sales. Each handisaw takes approximately 0.30 hours to manufacture, and Wesley pays an average labor wage of $15.00 per hour. Each handisaw requires a plastic housing that Wesley purchases from a supplier at a cost of $5.00 each. The company has an ending raw materials inventory policy of 10 percent of the following month's production requirements. Materials other than the housing unit total $4.00 per handisaw. Manufacturing overhead for this product includes $60,000 annual fixed overhead (based on production of 24,000 units) and $.80 per unit variable manufacturing overhead. Wesley's selling expenses are 5 percent of sales dollars, and administrative expenses are fixed at $14,000 per month. Required: Compute the budgeted net operating income for January. (Round intermediate calculations to two decimal places. Round final answers to the nearest dollar amount.)

Wesley Power Tools manufactures a wide variety of tools and accessories. One of its more popular items is a cordless power handisaw. Each handisaw sells for $50. Wesley expects the following unit sales: January February 2, 000 2, 500 3, 100 2, 900 2, 200 March April Мay Wesley's ending finished goods inventory policy is 20 percent of the next month's sales. Each handisaw takes approximately 0.30 hours to manufacture, and Wesley pays an average labor wage of $15.00 per hour. Each handisaw requires a plastic housing that Wesley purchases from a supplier at a cost of $5.00 each. The company has an ending raw materials inventory policy of 10 percent of the following month's production requirements. Materials other than the housing unit total $4.00 per handisaw. Manufacturing overhead for this product includes $60,000 annual fixed overhead (based on production of 24,000 units) and $.80 per unit variable manufacturing overhead. Wesley's selling expenses are 5 percent of sales dollars, and administrative expenses are fixed at $14,000 per month. Required: Compute the budgeted net operating income for January. (Round intermediate calculations to two decimal places. Round final answers to the nearest dollar amount.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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