Chapter 7, Problem 15E

Cost of goods sold budget

Delaware Chemical Company uses oil to produce two types of plastic products, P1 and P2. Delaware budgeted 35,000 barrels of oil for purchase in June for $90 per barrel. Direct labor budgeted in the chemical process was $240,000 for June. Factory overhead was budgeted at $400,000 during June. The inventories on June 1 were estimated to be:

The desired inventories on June 30 were:

Use the preceding information to prepare a cost of goods sold budget for June.