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 $44. Wesley expects the following unit sales: 3,600 3,800 4,300 4,100 3,500 January February March April May Wesley's ending finished goods inventory policy is 30 percent of the next month's sales. Suppose each handisaw takes approximately 0.60 hours to manufacture, and Wesley pays an average labor wage of $20 per hour. Each handisaw requires a plastic housing that Wesley purchases from a supplier at a cost of $7.00 each. The company has an ending direct materials inventory policy of 20 percent of the following month's production requirements. Materials other than the housing unit total $4.50 per handisaw. Manufacturing overhead for this product includes $72,000 annual fixed overhead (based on production of 27,000 units) and $1.20 per unit variable manufacturing overhead. Wesley's selling expenses are 7 percent of sales dollars, and administrative expenses are fixed at $18,000 per month. Required: Compute the following for the first quarter: (Round your intermediate calculations to nearest whole dollar.) January February March 1st Quarter total 1. Budgeted Sales Revenue 158,400 167,200 $ 189,200 $ 514,800 2. Budgeted Production in Units 3. Budgeted Cost of Direct Materials Purchases for the Plastic Housings 4. Budgeted Direct Labor Cost 2$
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 $44. Wesley expects the following unit sales: 3,600 3,800 4,300 4,100 3,500 January February March April May Wesley's ending finished goods inventory policy is 30 percent of the next month's sales. Suppose each handisaw takes approximately 0.60 hours to manufacture, and Wesley pays an average labor wage of $20 per hour. Each handisaw requires a plastic housing that Wesley purchases from a supplier at a cost of $7.00 each. The company has an ending direct materials inventory policy of 20 percent of the following month's production requirements. Materials other than the housing unit total $4.50 per handisaw. Manufacturing overhead for this product includes $72,000 annual fixed overhead (based on production of 27,000 units) and $1.20 per unit variable manufacturing overhead. Wesley's selling expenses are 7 percent of sales dollars, and administrative expenses are fixed at $18,000 per month. Required: Compute the following for the first quarter: (Round your intermediate calculations to nearest whole dollar.) January February March 1st Quarter total 1. Budgeted Sales Revenue 158,400 167,200 $ 189,200 $ 514,800 2. Budgeted Production in Units 3. Budgeted Cost of Direct Materials Purchases for the Plastic Housings 4. Budgeted Direct Labor Cost 2$
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text: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 $44. Wesley expects the following unit sales:
3,600
3,800
4,300
4,100
3,500
January
February
March
April
May
Wesley's ending finished goods inventory policy is 30 percent of the next month's sales.
Suppose each handisaw takes approximately 0.60 hours to manufacture, and Wesley pays an average labor wage of $20 per hour.
Each handisaw requires a plastic housing that Wesley purchases from a supplier at a cost of $7.00 each. The company has an ending
direct materials inventory policy of 20 percent of the following month's production requirements. Materials other than the housing unit
total $4.50 per handisaw.
Manufacturing overhead for this product includes $72,000 annual fixed overhead (based on production of 27,000 units) and $1.20 per
unit variable manufacturing overhead. Wesley's selling expenses are 7 percent of sales dollars, and administrative expenses are fixed
at $18,000 per month.
Required:
Compute the following for the first quarter: (Round your intermediate calculations to nearest whole dollar.)
January
February
March
1st Quarter total
1.
Budgeted Sales Revenue
158,400
167,200 $
189,200 $
514,800
2.
Budgeted Production in Units
3.
Budgeted Cost of Direct Materials Purchases for the Plastic Housings
4.
Budgeted Direct Labor Cost
2$
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