Budgeted Income Statement and Supporting Budgets The budget director of Feathered Friends 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 December: Estimated sales for December: Bird house 3,200 units at $50 per unit Bird feeder 3,000 units at $70 per unit Estimated inventories at December 1: Direct materials: Wood 200 ft. Plastic 240 lbs. Finished products: Bird house 320 units at $27 per unit Bird feeder 270 units at $40 per unit Desired inventories at December 31: Direct materials: Wood 220 ft. Plastic 200 lbs. Finished products: Bird house 290 units at $27 per unit Bird feeder 250 units at $41 per unit Direct materials used in production: In manufacture of Bird House: Wood 0.80 ft. per unit of product Plastic 0.50 lb. per unit of product In manufacture of Bird Feeder: Wood 1.20 ft. per unit of product Plastic 0.75 lb. per unit of product Anticipated cost of purchases and beginning and ending inventory of direct materials: Wood $7.00 per ft. Plastic $1.00 per lb. Direct labor requirements: Bird House: Fabrication Department 0.20 hr. at $16 per hr. Assembly Department 0.30 hr. at $12 per hr. Bird Feeder: Fabrication Department 0.40 hr. at $16 per hr. Assembly Department 0.35 hr. at $12 per hr. Estimated factory overhead costs for December: Indirect factory wages $75,000 Depreciation of plant and equipment 23,000 Power and light 6,000 Insurance and property tax 5,000 Estimated operating expenses for December: Sales salaries expense $70,000 Advertising expense 18,000 Office salaries expense 21,000 Depreciation expense—office equipment 600 Telephone expense—selling 550 Telephone expense—administrative 250 Travel expense—selling 4,000 Office supplies expense 200 Miscellaneous administrative expense 400 Estimated other income and expense for December: Interest revenue $200 Interest expense 122 Estimated tax rate: 30% 4. Prepare a direct labor cost budget for December. Feathered Friends Inc. Direct Labor Cost Budget For the Month Ending December 31 Fabrication Department Assembly Department Total Hours required for production: Bird house fill in the blank 40 fill in the blank 41 Bird feeder fill in the blank 42 fill in the blank 43 Total fill in the blank 44 fill in the blank 45 Hourly rate fill in the blank 46 fill in the blank 47 Total direct labor cost fill in the blank 48 fill in the blank 49 fill in the blank 50 5. Prepare a factory overhead cost budget for December. Feathered Friends Inc. Factory Overhead Cost Budget For the Month Ending December 31 $fill in the blank 52 fill in the blank 54 fill in the blank 56 fill in the blank 58 Total factory overhead cost $fill in the blank 59 6. Prepare a cost of goods sold budget for December. Work in process at the beginning of December is estimated to be $29,000, and work in process at the end of December is estimated to be $35,400. For those boxes in which you must enter subtracted or negative numbers use a minus sign. Feathered Friends Inc. Cost of Goods Sold Budget For the Month Ending December 31 fill in the blank 61 fill in the blank 63 Direct materials: fill in the blank 65 fill in the blank 67 Cost of direct materials available for use fill in the blank 68 fill in the blank 70 Cost of direct materials placed in production fill in the blank 71 fill in the blank 73 fill in the blank 75 Total manufacturing costs fill in the blank 76 Total work in process during period fill in the blank 77 fill in the blank 79 Cost of goods manufactured fill in the blank 80 Cost of finished goods available for sale fill in the blank 81 fill in the blank 83 Cost of goods sold fill in the blank 84

Budgeted Income Statement and Supporting Budgets The budget director of Feathered Friends 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 December: Estimated sales for December: Bird house 3,200 units at $50 per unit Bird feeder 3,000 units at $70 per unit Estimated inventories at December 1: Direct materials: Wood 200 ft. Plastic 240 lbs. Finished products: Bird house 320 units at $27 per unit Bird feeder 270 units at $40 per unit Desired inventories at December 31: Direct materials: Wood 220 ft. Plastic 200 lbs. Finished products: Bird house 290 units at $27 per unit Bird feeder 250 units at $41 per unit Direct materials used in production: In manufacture of Bird House: Wood 0.80 ft. per unit of product Plastic 0.50 lb. per unit of product In manufacture of Bird Feeder: Wood 1.20 ft. per unit of product Plastic 0.75 lb. per unit of product Anticipated cost of purchases and beginning and ending inventory of direct materials: Wood $7.00 per ft. Plastic $1.00 per lb. Direct labor requirements: Bird House: Fabrication Department 0.20 hr. at $16 per hr. Assembly Department 0.30 hr. at $12 per hr. Bird Feeder: Fabrication Department 0.40 hr. at $16 per hr. Assembly Department 0.35 hr. at $12 per hr. Estimated factory overhead costs for December: Indirect factory wages $75,000 Depreciation of plant and equipment 23,000 Power and light 6,000 Insurance and property tax 5,000 Estimated operating expenses for December: Sales salaries expense $70,000 Advertising expense 18,000 Office salaries expense 21,000 Depreciation expense—office equipment 600 Telephone expense—selling 550 Telephone expense—administrative 250 Travel expense—selling 4,000 Office supplies expense 200 Miscellaneous administrative expense 400 Estimated other income and expense for December: Interest revenue $200 Interest expense 122 Estimated tax rate: 30% 4. Prepare a direct labor cost budget for December. Feathered Friends Inc. Direct Labor Cost Budget For the Month Ending December 31 Fabrication Department Assembly Department Total Hours required for production: Bird house fill in the blank 40 fill in the blank 41 Bird feeder fill in the blank 42 fill in the blank 43 Total fill in the blank 44 fill in the blank 45 Hourly rate fill in the blank 46 fill in the blank 47 Total direct labor cost fill in the blank 48 fill in the blank 49 fill in the blank 50 5. Prepare a factory overhead cost budget for December. Feathered Friends Inc. Factory Overhead Cost Budget For the Month Ending December 31 $fill in the blank 52 fill in the blank 54 fill in the blank 56 fill in the blank 58 Total factory overhead cost $fill in the blank 59 6. Prepare a cost of goods sold budget for December. Work in process at the beginning of December is estimated to be $29,000, and work in process at the end of December is estimated to be $35,400. For those boxes in which you must enter subtracted or negative numbers use a minus sign. Feathered Friends Inc. Cost of Goods Sold Budget For the Month Ending December 31 fill in the blank 61 fill in the blank 63 Direct materials: fill in the blank 65 fill in the blank 67 Cost of direct materials available for use fill in the blank 68 fill in the blank 70 Cost of direct materials placed in production fill in the blank 71 fill in the blank 73 fill in the blank 75 Total manufacturing costs fill in the blank 76 Total work in process during period fill in the blank 77 fill in the blank 79 Cost of goods manufactured fill in the blank 80 Cost of finished goods available for sale fill in the blank 81 fill in the blank 83 Cost of goods sold fill in the blank 84

Financial And Managerial Accounting

15th Edition

ISBN:9781337902663

Author:WARREN, Carl S.

Publisher:WARREN, Carl S.

Chapter22: Budgeting

Section: Chapter Questions

Problem 3PB: Budgeted income statement and supporting budgets The budget director of Gold Medal Athletic Co.,...

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Question

Budgeted Income Statement and Supporting Budgets

The budget director of Feathered Friends 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 December:

Estimated sales for December:

Bird house 3,200 units at $50 per unit

Bird feeder 3,000 units at $70 per unit
Estimated inventories at December 1:

Direct materials:

Wood 200 ft.

Plastic 240 lbs.

Finished products:

Bird house 320 units at $27 per unit

Bird feeder 270 units at $40 per unit
Desired inventories at December 31:

Direct materials:

Wood 220 ft.

Plastic 200 lbs.

Finished products:

Bird house 290 units at $27 per unit

Bird feeder 250 units at $41 per unit

Direct materials used in production:

In manufacture of Bird House:
Wood	0.80 ft. per unit of product
Plastic	0.50 lb. per unit of product
In manufacture of Bird Feeder:
Wood	1.20 ft. per unit of product
Plastic	0.75 lb. per unit of product

Anticipated cost of purchases and beginning and ending inventory of direct materials:

Wood $7.00 per ft.

Plastic $1.00 per lb.

Direct labor requirements:

Bird House:
Fabrication Department	0.20 hr. at $16 per hr.
Assembly Department	0.30 hr. at $12 per hr.
Bird Feeder:
Fabrication Department	0.40 hr. at $16 per hr.
Assembly Department	0.35 hr. at $12 per hr.

Estimated factory overhead costs for December:

Indirect factory wages $75,000

Depreciation of plant and equipment 23,000

Power and light 6,000

Insurance and property tax 5,000

Estimated operating expenses for December:

Sales salaries expense	$70,000
Advertising expense	18,000
Office salaries expense	21,000
Depreciation expense—office equipment	600
Telephone expense—selling	550
Telephone expense—administrative	250
Travel expense—selling	4,000
Office supplies expense	200
Miscellaneous administrative expense	400

Estimated other income and expense for December:

Interest revenue $200

Interest expense 122
Estimated tax rate: 30%

4. Prepare a direct labor cost budget for December.

Feathered Friends Inc. Direct Labor Cost Budget For the Month Ending December 31
		Fabrication Department		Assembly Department	Total
Hours required for production:
	Bird house		fill in the blank 40		fill in the blank 41
	Bird feeder		fill in the blank 42		fill in the blank 43
	Total		fill in the blank 44		fill in the blank 45
Hourly rate		fill in the blank 46		fill in the blank 47
Total direct labor cost		fill in the blank 48		fill in the blank 49	fill in the blank 50

5. Prepare a factory overhead cost budget for December.

Feathered Friends Inc. Factory Overhead Cost Budget For the Month Ending December 31
	$fill in the blank 52
	fill in the blank 54
	fill in the blank 56
	fill in the blank 58
Total factory overhead cost	$fill in the blank 59

6. Prepare a cost of goods sold budget for December. Work in process at the beginning of December is estimated to be $29,000, and work in process at the end of December is estimated to be $35,400. For those boxes in which you must enter subtracted or negative numbers use a minus sign.

Feathered Friends Inc. Cost of Goods Sold Budget For the Month Ending December 31
			fill in the blank 61
		fill in the blank 63
Direct materials:
	fill in the blank 65
	fill in the blank 67
Cost of direct materials available for use	fill in the blank 68
	fill in the blank 70
Cost of direct materials placed in production	fill in the blank 71
	fill in the blank 73
	fill in the blank 75
Total manufacturing costs		fill in the blank 76
Total work in process during period		fill in the blank 77
		fill in the blank 79
Cost of goods manufactured			fill in the blank 80
Cost of finished goods available for sale			fill in the blank 81
			fill in the blank 83
Cost of goods sold			fill in the blank 84

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Bird house	3,200 units at $50 per unit
Bird feeder	3,000 units at $70 per unit

Direct materials:
Wood	200 ft.
Plastic	240 lbs.
Finished products:
Bird house	320 units at $27 per unit
Bird feeder	270 units at $40 per unit

Direct materials:
Wood	220 ft.
Plastic	200 lbs.
Finished products:
Bird house	290 units at $27 per unit
Bird feeder	250 units at $41 per unit

Indirect factory wages	$75,000
Depreciation of plant and equipment	23,000
Power and light	6,000
Insurance and property tax	5,000