Morganton Company makes one product, and has provided the following information to help prepare the master budgetfor its first four months of operations:a. The budgeted selling price per unit is $70. Budgeted unit sales for June, July, August, and September are 9,100,22,000, 24,000, and 25,000 units, respectively. All sales are on credit.b. Forty percent of credit sales are collected in the month of the sale and 60% in the following month.c. The ending finished goods inventory equals 20% of the following month's unit sales.d. The ending raw materials inventory equals 10% of the following month's raw materials production needs. Each unit offinished goods requires 4 kilograms of raw materials. The raw materials cost $2.50 per kilogram.e. Forty percent of raw materials purchases are paid for in the month of purchase and 60% in the following month.f. The direct labour wage rate is $12 per hour. Each unit of finished goods requires two direct labour-hours.g. The variable selling and administrative expense per unit sold is $1.70. The fixed selling and administrative expense permonth is $61,000.5. If 96,800 kilograms of raw materials are needed to meet production in August, how many kilograms of raw materials should bepurchased in July?Raw materials to be purchased90,320 kilograms< Prev567...10of 10Next > [The following information applies to the questionsMorganton Company makes one product, and has provided the following information to help prepare the master budgetfor its first four months of operations:a. The budgeted selling price per unit is $70. Budgeted unit sales for June, July, August, and September are 9,100,22,000, 24,000, and 25,000 units, respectively. All sales are on credit.b. Forty percent of credit sales are collected in the month of the sale and 60% in the following month.c. The ending finished goods inventory equals 20% of the following month's unit sales.d. The ending raw materials inventory equals 10% of the following month's raw materials production needs. Each unit offinished goods requires 4 kilograms of raw materials. The raw materials cost $2.50 per kilogram.e. Forty percent of raw materials purchases are paid for in the month of purchase and 60% in the following month.f. The direct labour wage rate is $12 per hour. Each unit of finished goods requires two direct labour-hours.g. The variable selling and administrative expense per unit sold is $1.70. The fixed selling and administrative expense permonth is $61,000.4. According to the production budget, how many units should be produced in July?Required production22,400 units< Prev456***10of 10Next >

4. Opening stock + Production = Sale + Closing stock (22,000×20%) + Production = 22,000 +…

Morganton Company makes one product, and has provided the following information to help prepare the master budget for its first four months of operations: a. The budgeted selling price per unit is $70. Budgeted unit sales for June, July, August, and September are 9,100, 22,000, 24,000, and 25,000 units, respectively. All sales are on credit. b. Forty percent of credit sales are collected in the month of the sale and 60% in the following month. c. The ending finished goods inventory equals 20% of the following month's unit sales. d. The ending raw materials inventory equals 10% of the following month's raw materials production needs. Each unit of finished goods requires 4 kilograms of raw materials. The raw materials cost $2.50 per kilogram. e. Forty percent of raw materials purchases are paid for in the month of purchase and 60% in the following month. f. The direct labour wage rate is $12 per hour. Each unit of finished goods requires two direct labour-hours. g. The variable selling and administrative expense per unit sold is $1.70. The fixed selling and administrative expense per month is $61,000. 4. According to the production budget, how many units should be produced in July? Required production 22,400 units

Morganton Company makes one product, and has provided the following information to help prepare the master budget for its first four months of operations: a. The budgeted selling price per unit is $70. Budgeted unit sales for June, July, August, and September are 9,100, 22,000, 24,000, and 25,000 units, respectively. All sales are on credit. b. Forty percent of credit sales are collected in the month of the sale and 60% in the following month. c. The ending finished goods inventory equals 20% of the following month's unit sales. d. The ending raw materials inventory equals 10% of the following month's raw materials production needs. Each unit of finished goods requires 4 kilograms of raw materials. The raw materials cost $2.50 per kilogram. e. Forty percent of raw materials purchases are paid for in the month of purchase and 60% in the following month. f. The direct labour wage rate is $12 per hour. Each unit of finished goods requires two direct labour-hours. g. The variable selling and administrative expense per unit sold is $1.70. The fixed selling and administrative expense per month is $61,000. 4. According to the production budget, how many units should be produced in July? Required production 22,400 units

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter7: Budgeting

Section: Chapter Questions

Problem 3PB: TIB makes custom guitars and prepared the following sales budget for the second quarter It also has...

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