Margaret had just finished the production budget for her division and now needs to further consider related cash needs. Since laborcosts are a significant cash outflow for her company, she opts to complete that budget next. The production budget ended as followsfor the second quarter.Production (units)Month 17,300Textbook and MediaMonth 29,800Every unit requires 3.40 hours of DL time, which is estimated to cost the company $18/hour. Help Margaret prepare the direct laborbudget for her company for the second quarter, identifying total DL hours as well as total DL cost for each month and for the quarteras a whole. (Round hours per unit to 2 decimal places, e.g. 15.25.)$Month 3$7,000Month 1$Month 2$$Month 3

The budget is prepared to estimate the requirements for the future period. The direct labor budget…

Margaret had just finished the production budget for her division and now needs to further consider related cash needs. Since labor costs are a significant cash outflow for her company, she opts to complete that budget next. The production budget ended as follows for the second quarter. Production (units) Month 1 7,300 Month 2 9,800 Month 3 7,000 Every unit requires 3.40 hours of DL time, which is estimated to cost the company $18/hour. Help Margaret prepare the direct labor budget for her company for the second quarter, identifying total DL hours as well as total DL cost for each month and for the quarter as a whole. (Round hours per unit to 2 decimal places, e.g. 15.25.)

Margaret had just finished the production budget for her division and now needs to further consider related cash needs. Since labor costs are a significant cash outflow for her company, she opts to complete that budget next. The production budget ended as follows for the second quarter. Production (units) Month 1 7,300 Month 2 9,800 Month 3 7,000 Every unit requires 3.40 hours of DL time, which is estimated to cost the company $18/hour. Help Margaret prepare the direct labor budget for her company for the second quarter, identifying total DL hours as well as total DL cost for each month and for the quarter as a whole. (Round hours per unit to 2 decimal places, e.g. 15.25.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

As department manager you are responsible for developing a yearly budget. There are 10 employees in the department. Each employee makes $40,000 per year. Your salary is $55,000 per year. Utilities are estimated at $50 per employee per month. In addition you must also do the following: Find and budget for three team building activities (Not all in the same month) Budget for Green Belt training for your team – find actual cost (spread out over 2 months) Develop one Six Sigma project for the month of September Budget for training 5 employees 5 hours per month for the months on June, July and August. Training is budgeted separately and the time in training is deducted from regular pay. (rate of pay is the same) During October the warehouse will be expanded and you will have to staff it with 5 employees each making $24,000 per year. Employees will remain for the rest of the year Buy or lease two battery operated forklifts in October for the warehouse – uses real data In November you will…
Ever Clean Company provides gutter cleaning services to residential clients. Overhead is allocated based on direct labor-hours (DLH). The owner, Joanne Clark, estimates that her gutter cleaners will work a total of 1,000 jobs during the year. Each job averages 600 feet of gutter surface and requires 12 direct labor-hours. Clark pays her gutter cleaners $15 per hour. The following table presents the budgeted overhead costs for 2018: Supplies ($6.50 per DLH) Fixed costs (to support capacity of 12,000 DLH) Indirect labor Depreciation Other Total budgeted costs The direct labor budget (in hours) is closest to O A. 12,000 Variable costs O B. 1,000 O C. 180,000 $ 78,000 25,000 17,000 24,000 $144,000
You have just been hired into a management position which requires the application of your budgeting skills. You find out that budgeting has not been a priority of the company. You have contacted various areas on the organization and have accumulated the information below to assist you in preparing a comprehensive budget. Manufacturing Inc. produces a part used in the production of engines. Actual Sales and Projected sales in units: March (Actual) 38,000 April 40,000 May 42,000 June 45,000 July 44,000 Sales are the following type: 51% Cash sales collected in month of sale 49% Credit sales collected in the following month of sale…
Management has studied work patterns in the housekeeping department and estimates the number of hours to be worked as follows. Hours worked = (1,500 per month) + (0.50 X RVUs).For the coming month, management expects relative value units (RVU) to be 5,800. What should budgeted labor for the month be?
Ever Clean Company provides gutter cleaning services to residential clients. Overhead is allocated based on direct labor-hours (DLH). The owner, Joanne Clark, estimates that her gutter cleaners will work a total of 1,000 jobs during the year. Each job averages 600 feet of gutter surface and requires 12 direct labor-hours. Clark pays her gutter cleaners $15 per hour. The following table presents the budgeted overhead costs for 2018: Variable costs Supplies ($6.50 per DLH) Fixed costs (to support capacity of 12,000 DLH) Indirect labor Depreciation Other Total budgeted costs The budgeted overhead rate (USD/DLH) is closest to O A. 5.50 O B. 12.00 O C. 6.50 $ 78,000 25,000 17,000 24,000 $144,000
The Puyer Corporation makes and sells only one product called a Deb. The company is in the process of preparing its Selling and Administrative Expense Budget for next year. The following budget data are available: Sales commissions Shipping Advertising Executive salaries Depreciation on office equipment Other Multiple Choice $ 50,000 $ 60,000 $ 20,000 $ 40,000 All of these expenses (except depreciation) are paid in cash in the month they are incurred. If the budgeted cash disbursements for selling and administrative expenses for April total $195,500, then how many Debs does the company plan to sell in April? 14,400 units 8.000 units Monthly Fixed Cost 10,200 units Variable Cost Per Deb Sold $ 0.90 $ 1.40 $ 0.20
Easy Clean operates a chain of dry cleaners. It is experimenting with the use of a continuous-improvement (i.e., kaizen) budget for operating expenses. Currently, a typical location has operating expenses of $28,000 per month. Plans are in place to achieve labor and utility savings. The associated operational changes are estimated to reduce monthly operating expenses by a factor of 0.99 beginning in January. Required: What are the estimated operating expenses for January? For June? For December? (Do not round intermediate calculations. Round your final answers to the nearest whole dollar amount.) January June December Estimated operating costs
Roboclean Ltd makes two types of robotic vacuum cleaner: iClean and HiClean. Both products offer a high level of cleaning suction, but the HiClean includes the benefit of an anti-allergy filter when the air is expelled. Spring is the busiest time of year and the management accountant has provided the following budgeted information for the month of January 2019: Fixed costs for the month are estimated at £40,000. These are divided equally between the two products. The selling price of iClean is £32.50. The direct costs of each iClean are direct materials £12.00 and direct labour £3.00. The selling price of HiClean is £40.00. The direct costs of each HiClean are direct materials £14.00 and direct labour £2.00. You have been asked to provide a report that will help the managing director consider the effect of changes in the level of sales activity and other factors on the company’s financial objectives for the month. Required Prepare a marginal cost statement for January…
Blue Devil Inc. has a significant level of manufacturing overhead. After preparing their budget for the next year, management expects the following overhead costs (the cost driver for each overhead cost pool is also shown): Activity Total Cost Cost Driver Maintenance $20,000 Machine hours Materials receiving 80,000 Shipments received Machine setups 50,000 Number of setups Inspection 40,000 Number of inspections The expected activity for the year for various cost drivers is: Direct Labor Hours 40,000 Machine Hours 20,000 Shipments Received 4,000 Setups 200 Quality Inspections 8,000 The company is considering accepting a significant production contract. Estimates for the contract are as follows: Direct materials $100,000 Direct labor (7,500 hours) $150,000 Number of material shipments received 290 Number of inspections 50 Number of setups 35 Number of machine hour 3,000…
Vaughn Manufacturing makes and sells umbrellas. The company is in the process of preparing its Selling and Administrative Expense Budget for the last half of the year. The following budget data are available: Variable Cost Per Unit Sold Monthly Fixed Cost Sales commissions $0.60 $ 6500 Shipping 1.20 Advertising 0.30 Executive salaries 35000 Depreciation on office equipment 7000 Other 0.35 22000 Expenses are paid in the month incurred. If the company has budgeted to sell 6500 umbrellas in October, how much is the total budgeted variable selling and administrative expenses for October? $16908 $13650 $15925 $86425
Annie's Homemade is preparing a planning budget for August. Its budgeted revenue per serving is $5.00. It has identified two cost drivers-number of servings and number of labor-hours. The company expects to sell 10,800 servings and to staff 700 employee labor-hours in August. Data concerning the company's cost formulas are shown below: Ingredients expense Salaries and wages expense Franchise fee Credit card processing fees Utilities expense $ 300 Rent expense $ 3,000 Equipment depreciation expense $1,750 Other expenses $4,200 Required: Prepare a planning budget for August. Budgeted servings Budgeted labor-hours Revenue Expenses: Fixed Cost Cost per Per Month $ 7,000 Ingredients expense Salaries and wages expense Franchise fee Credit card processing fees Utilities expense Rent expense Equipment depreciation expense Other expenses Total expense Net operating income $ Serving $ 1.25 $ 0.25 $ 0.09 $ 0.02 0 Cost per Labor-Hour $ 8.00
The management of Springer plc is considering next year’s production and purchase budget. One of the components produced by the company, which is incorporated into another product before being sold, has budgeted manufacturing costs as follows: $ Direct Material 14 Direct labour (4 hours at $3 per hour) 12 Variable overhead (4 hours at $2 per hour) 8 Fixed overheads (4 hours at $5 per hour) 20 Total Cost $54 per unit Trigger plc has offered to supply the above component at a guaranteed price of $50 per unit. Required: Considering cost criteria only, advise management whether the above component should be purchased from Trigger plc. Any calculation should be shown and assumptions made, or aspects which may require further investigation should be clearly stated. Explain how your advice would be affected by the following: “As a result of recent government legislation if Springer plc continues to manufacture this component, the company will incur additional inspection and…