Financial & Managerial Accounting
13th Edition
ISBN: 9781285866307
Author: Carl Warren, James M. Reeve, Jonathan Duchac
Publisher: Cengage Learning
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Chapter 21, Problem 21.17EX
Cost of goods sold budget
The controller of MingWare Ceramics Inc. wishes to prepare a cost of goods sold budget for September. The controller assembled the following information for constructing the cost of goods sold budget:
Use the preceding information to prepare a cost of goods sold budget for September 2016.
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Answer-Prepare for January 2023:
-Direct materials purchases budget
-Direct labor costs budget
-Factory overhead budget
Brighter Corporation manufactures and sells two types of decorative lamps, Knox and Ayer. The
are available for the year 2017.
E (Click the icon to view the information.)
Calculate (1) the cost of goods sold budget (label it Schedule 7) (2) the nonmanufacturing c
it Schedule 8) and (3) the operating income budget for the year ending December 31, 2017.
(1). Begin by calculating (1) the cost of goods sold budget (label it Schedule 7) for the year ending December 31, 2017.
Schedule 7: Cost of Goods Sold Budget
for the Year Ending December 31, 2017
Data Table
Revenues
%24
1,039,400
Beginning inventory of finished goods (1-1-2017)
88,440
Ending inventory of finished goods, 12-31-2017
66,780
Direct materials used
417,000
Direct manufacturing labor
120,900
Manufacturing overhead
137,450
Variable marketing costs (5% of revenues)
Fixed marketing costs
45,000
Variable distribution costs ($0.50 per cu. ft. for 28,000 cu. ft.)
Fixed distribution costs
47,000
Fixed administration costs
78,000
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Required
A. Prepare the following operating budget for Lavish Towel for the month of May.
1. Sales budget
4. DL budget
2. Production budget
5. MOH budget
3. DM purchases budget
6. SG&A budget
B. Prepare the budgeted COGS schedule and income statement for May. Assume there is no beginning orending WIP inventory in May. Lavish uses the FIFO method inventory valuation
C. Explain how the pieces from this budgeted income statement would affect Lavish's Cash budget, as well as its budgeted balance sheet for May.
Chapter 21 Solutions
Financial & Managerial Accounting
Ch. 21 - Prob. 1DQCh. 21 - Briefly describe the type of human behavior...Ch. 21 - What behavioral problems are associated with...Ch. 21 - What behavioral problems are associated with...Ch. 21 - Under what circumstances would a static budget be...Ch. 21 - How do computerized budgeting systems aid firms in...Ch. 21 - Why should the production requirements Set forth...Ch. 21 - Prob. 8DQCh. 21 - A. Discuss the purpose of the cash budget. B. If...Ch. 21 - Give an example of how the capital expenditures...
Ch. 21 - Flexible budgeting At the beginning of the period,...Ch. 21 - Prob. 21.1BPECh. 21 - Prob. 21.2APECh. 21 - Prob. 21.2BPECh. 21 - Direct materials purchases budget My Life...Ch. 21 - Prob. 21.3BPECh. 21 - Direct labor cost budget MyLife Chronicles Inc....Ch. 21 - Prob. 21.4BPECh. 21 - Prob. 21.5APECh. 21 - Prob. 21.5BPECh. 21 - Prob. 21.6APECh. 21 - Prob. 21.6BPECh. 21 - Personal budget At the beginning of the 2016...Ch. 21 - Flexible budget for selling and administrative...Ch. 21 - Static budget versus flexible budget The...Ch. 21 - Prob. 21.4EXCh. 21 - Prob. 21.5EXCh. 21 - Prob. 21.6EXCh. 21 - Prob. 21.7EXCh. 21 - Prob. 21.8EXCh. 21 - Direct materials purchases budget Romano's Frozen...Ch. 21 - Prob. 21.10EXCh. 21 - Prob. 21.11EXCh. 21 - Direct labor cost budget Ace Racket Company...Ch. 21 - Prob. 21.13EXCh. 21 - Production and direct labor cost budgets Levi...Ch. 21 - Prob. 21.15EXCh. 21 - Cost of goods sold budget Delaware Chemical...Ch. 21 - Cost of goods sold budget The controller of...Ch. 21 - Schedule of cash collections of accounts...Ch. 21 - Schedule of cash collections of accounts...Ch. 21 - Schedule of cash payments for a service company...Ch. 21 - Schedule of cash payments for a service company...Ch. 21 - Capital expenditures budget On January 1, 2016,...Ch. 21 - Forecast sales volume and sales budget For 2016,...Ch. 21 - Sales, production, direct materials purchases, and...Ch. 21 - Budgeted income statement and supporting budgets...Ch. 21 - Cash budget The controller of Sonoma Housewares...Ch. 21 - Budgeted income statement and balance sheet As a...Ch. 21 - Prob. 21.1BPRCh. 21 - Sales, production, direct materials purchases, and...Ch. 21 - Budgeted income statement and supporting budgets...Ch. 21 - Cash budget The controller of Mercury Shoes Inc....Ch. 21 - Prob. 21.5BPRCh. 21 - Prob. 21.1CPCh. 21 - Prob. 21.2CPCh. 21 - Static budget for a service company A bank manager...Ch. 21 - Objectives of the master budget Dominos Pizza LLC....Ch. 21 - Integrity and evaluating budgeting systems The...
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- Cost of goods sold budget The controller of Pueblo Ceramics Inc. wishes to prepare a cost of goods sold budget for April. The controller assembled the following information for constructing the cost goods sold budget: Use the preceding information to prepare a cost of goods sold budget for April.arrow_forwardBudgeted income statement and supporting budgets The budget director of Gold Medal Athletic Co., with the assistance of the controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income statement for March: Estimated sales for March: Estimated inventories at March 1: Desired inventories at March 31: Direct materials used in production: Anticipated cost of purchases and beginning and ending inventory of direct materials: Direct labor requirements: Estimated factory overhead costs for March: Estimated operating expenses for March: Estimated other revenue and expense for March: Estimated tax rate: 30% Instructions Prepare a sales budget for March. Prepare a production budget for March. Prepare a direct materials purchases budget for March. Prepare a direct labor cost budget for March. Prepare a factory overhead cost budget for March. Prepare a cost of goods sold budget for March. Work in process at the beginning of March is estimated to be 15,300, and work in process at the end of March is desired to be 14,800. Prepare a selling and administrative expenses budget for March. Prepare a budgeted income statement for March.arrow_forwardBudgeted income statement and supporting budgets The budget director of Birding Homes Feeders Inc., with the assistance of the controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income statement for January: Estimated sales for January: Estimated inventories at January 1: Desired inventories at January 31: Direct materials used in production: Anticipated cost of purchases and beginning and ending inventory of direct materials: Direct labor requirements: Estimated factory overhead costs for January: Estimated operating expenses for January: Estimated other revenue and expense for January: Estimated tax rate: 25% Instructions Prepare a sales budget for January. Prepare a production budget for January. Prepare a direct materials purchases budget for January. Prepare a direct labor cost budget for January. Prepare a factory overhead cost budget for January. Prepare a cost of goods sold budget for January. Work in process at the beginning of January is estimated to be 9,000, and work in process at the end of January is estimated to be 10,500. Prepare a selling and administrative expenses budget for January. Prepare a budgeted income statement for January.arrow_forward
- Sales, production, direct materials purchases, and direct labor cost budgets The budget director of Gourmet Grill Company requests estimates of sales, production, and other operating data from the various administrative units every month. Selected information concerning sales and production for July is summarized as follows: Estimated sales for July by sales territory: Estimated inventories at July 1: Desired inventories at July 31: Direct materials used in production: Anticipated purchase price for direct materials: Direct labor requirements: Instructions Prepare a sales budget for July. Prepare a production budget for July. Prepare a direct materials purchases budget for July. Prepare a direct labor cost budget for July.arrow_forwardSales, production, direct materials purchases, and direct labor cost budgets The budget director of Royal Furniture Company requests estimates of sales, production, and other operating data from the various administrative units every month. Selected information concerning sales and production for February is summarized as follows: Estimated sales of King and Prince chairs for February by sales territory: Estimated inventories at February 1: Desired inventories at February 28: Direct materials used in production: Anticipated purchase price for direct materials: Direct labor requirements: Instructions Prepare a sales budget for February. Prepare a production budget for February. Prepare a direct materials purchases budget for February. Prepare a direct labor cost budget for February.arrow_forwardThe budget that adjusts unit sales for beginning and ending inventories of finished goods is the: a. production budget b. purchases budget c. ending inventory of finished goods budget d. cost of goods sold budgetarrow_forward
- Prepare a cost of goods sold budget for Dream, Inc. they manufacture comforters. Assume the estimated inventories on January 1, 2008, for finished goods, work in process, and material were $51,000, $28,000, and $33,000 respectively. Also assume the desired inventories on December 31, 2008 for finished goods, work in process, and materials were $48,000, $35,000, and $29,000 respectively. Direct material purchases were $555,000. Direct labor was $252,000 for the year. Factory overhead was $176,000arrow_forwardOn the basis of the projected proceeding data and projections prepare the following for Year ended ended 31 December 2020: 1. Sales budget.2. Production budget.3. Labour cost budget.arrow_forwardam. 104.arrow_forward
- Q.Prepare a cost of goods sold budget for January 2018.arrow_forwardA merchandising company is working on their Inventory Purchase Budget to determine how much inventory will need to be purchased for the month of July. The following information has been gathered for this budget. Prepare an Inventory Purchase Budget for the month of July and for your answer below, enter the dollar value of how much this company would expect in Inventory Purchases for this month. (Round all calculations to a level that makes the most sense for this question. Enter your final answer rounded to the nearest whole dollar/input code: O) Budgeted Sales Cost of Goods Sold Inventory requirement June: $20,672 July: $26,904 August: $39,879 33% of Sales End each month with 17% of the following month's budgeted Cost of Goods Sold. (This requirement is expected for both the beginning and end of July.)arrow_forwardQ.Prepare an ending inventory budget for both direct materials and finished goods for January 2018.arrow_forward
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