The production manager of Rordan Corporation has submitted the following quarterly production forecast for the upcoming fiscal year: 1st Quarter 10,600 2nd Quarter 3rd Quarter 4th Quarter 8,000 8,300 10,600 Units to be produced Each unit requires 0.25 direct labor-hours, and direct laborers are paid $16.00 per hour. Required: 1. Prepare the company's direct labor budget for the upcoming fiscal year. (Round "Direct labor time per unit (hours)" answers to 2 decimal places.) Direct labor time per unit (hours) Total direct labor-hours needed Direct labor cost per hour Total direct labor cost Rordan Corporation Direct Labor Budget 2nd Quarter 1st Quarter 3rd Quarter 4th Quarter Year

The production manager of Rordan Corporation has submitted the following quarterly production forecast for the upcoming fiscal year: 1st Quarter 10,600 2nd Quarter 3rd Quarter 4th Quarter 8,000 8,300 10,600 Units to be produced Each unit requires 0.25 direct labor-hours, and direct laborers are paid $16.00 per hour. Required: 1. Prepare the company's direct labor budget for the upcoming fiscal year. (Round "Direct labor time per unit (hours)" answers to 2 decimal places.) Direct labor time per unit (hours) Total direct labor-hours needed Direct labor cost per hour Total direct labor cost Rordan Corporation Direct Labor Budget 2nd Quarter 1st Quarter 3rd Quarter 4th Quarter Year

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter9: Profit Planning And Flexible Budgets

Section: Chapter Questions

Problem 38BEB: Preparing a Direct Labor Budget Tulum Inc. makes a Mexican chocolate mix. Planned production in...

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Refer to Cornerstone Exercise 8.1, through Requirement 1. FlashKick requires ending inventory of product to equal 20 percent of the next months unit sales. Beginning inventory in January was 3,100 practice soccer balls and 400 match soccer balls. Required: 1. Construct a production budget for each of the two product lines for FlashKick Company for the first three months of the coming year. 2. What if FlashKick wanted a production budget for the two product lines for the month of April? What additional information would you need to prepare this budget? FlashKick Company manufactures and sells soccer balls for teams of children in elementary and high school. FlashKicks best-selling lines are the practice ball line (durable soccer balls for training and practice) and the match ball line (high-performance soccer balls used in games). In the first four months of next year, FlashKick expects to sell the following: Required: 1. Construct a sales budget for FlashKick for the first three months of the coming year. Show total sales for each product line by month and in total for the first quarter. 2. What if FlashKick added a third linetournament quality soccer balls that were expected to take 40 percent of the units sold of the match balls and would have a selling price of 45 each in January and February, and 48 each in March? Prepare a sales budget for Flash- Kick for the first three months of the coming year. Show total sales for each product line by month and in total for the first quarter.
Operating Budget, Comprehensive Analysis Allison Manufacturing produces a subassembly used in the production of jet aircraft engines. The assembly is sold to engine manufacturers and aircraft maintenance facilities. Projected sales in units for the coming 5 months follow: The following data pertain to production policies and manufacturing specifications followed by Allison Manufacturing: a. Finished goods inventory on January 1 is 32,000 units, each costing 166.06. The desired ending inventory for each month is 80% of the next months sales. b. The data on materials used are as follows: Inventory policy dictates that sufficient materials be on hand at the end of the month to produce 50% of the next months production needs. This is exactly the amount of material on hand on December 31 of the prior year. c. The direct labor used per unit of output is 3 hours. The average direct labor cost per hour is 14.25. d. Overhead each month is estimated using a flexible budget formula. (Note: Activity is measured in direct labor hours.) e. Monthly selling and administrative expenses are also estimated using a flexible budgeting formula. (Note: Activity is measured in units sold.) f. The unit selling price of the subassembly is 205. g. All sales and purchases are for cash. The cash balance on January 1 equals 400,000. The firm requires a minimum ending balance of 50,000. If the firm develops a cash shortage by the end of the month, sufficient cash is borrowed to cover the shortage. Any cash borrowed is repaid at the end of the quarter, as is the interest due (cash borrowed at the end of the quarter is repaid at the end of the following quarter). The interest rate is 12% per annum. No money is owed at the beginning of January. Required: 1. Prepare a monthly operating budget for the first quarter with the following schedules. (Note: Assume that there is no change in work-in-process inventories.) a. Sales budget b. Production budget c. Direct materials purchases budget d. Direct labor budget e. Overhead budget f. Selling and administrative expenses budget g. Ending finished goods inventory budget h. Cost of goods sold budget i. Budgeted income statement j. Cash budget 2. CONCEPTUAL CONNECTION Form a group with two or three other students. Locate a manufacturing plant in your community that has headquarters elsewhere. Interview the controller for the plant regarding the master budgeting process. Ask when the process starts each year, what schedules and budgets are prepared at the plant level, how the controller forecasts the amounts, and how those schedules and budgets fit in with the overall corporate budget. Is the budgetary process participative? Also, find out how budgets are used for performance analysis. Write a summary of the interview.
Preparing a Direct Labor Budget Tulum Inc. makes a Mexican chocolate mix. Planned production in units for the first 3 months of the coming year is: Each box of chocolate mix takes 0.4 direct labor hour. The average wage is 17 per hour. Required: Prepare a direct labor budget for the months of January, February, and March, as well as the total for the first quarter.
Refer to Cornerstone Exercise 8.2 for the production budgets for practice balls and match balls. Every practice ball requires 0.7 square yard of polyvinyl chloride panels, one bladder with valve (to fill with air), and 3 ounces of glue. FlashKicks policy is that 20 percent of the following months production needs for raw materials be in ending inventory. Beginning inventory in January for all raw materials met this requirement. Required: 1. Construct a direct materials purchases budget for each type of raw materials for the practice ball line for January and February of the coming year. 2. What if FlashKick decreased the ending inventory percentage to 15 percent of the next months production needs? What impact would that have on the direct materials purchases budgets prepared in Requirement 1? Refer to Cornerstone Exercise 8.1, through Requirement 1. FlashKick requires ending inventory of product to equal 20 percent of the next months unit sales. Beginning inventory in January was 3,100 practice soccer balls and 400 match soccer balls. Required: 1. Construct a production budget for each of the two product lines for FlashKick Company for the first three months of the coming year. 2. What if FlashKick wanted a production budget for the two product lines for the month of April? What additional information would you need to prepare this budget?
Pasadena Candle Inc. budgeted production of 785,000 candles for January. Wax is required to produce a candle. Assume 10 ounces of wax is required for each candle. The estimated January 1 wax inventory is 16,000 pounds. The desired January 31 wax inventory is 12,500 pounds. If candle wax costs 1.24 per pound, determine the direct materials purchases budget for January.
3 The production manager of Rordan Corporation has submitted the following quarterly production forecast for the upcoming fiscal year: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 10,400 8,000 8,200 10,500 Each unit requires 0.35 direct labor-hours, and direct laborers are paid $14.00 per hour. Units to be produced Required: 1. Prepare the company's direct labor budget for the upcoming fiscal year. (Round "Direct labor time per unit (hours)" answers to 2 decimal places.) Direct labor time per unit (hours) Total direct labor-hours needed Direct labor cost per hour Total direct labor cost 1st Quarter Rordan Corporation Direct Labor Budget 2nd Quarter 3rd Quarter 4th Quarter Year
Exercise 8-4 (Algo) Direct Labor Budget (LO8-5] The production manager of Rordan Corporation has submitted the following quarterly production forecast for the upcoming fiscal year: Units to be produced 1st Quarter 11,200 2nd Quarter 3rd Quarter 4th Quarter 8,500 8,600 10,900 Each unit requires 0.55 direct labor-hours, and direct laborers are paid $16.00 per hour. Required: 1. Prepare the company's direct labor budget for the upcoming fiscal year. (Round "Direct labor time per unit (hours)" answers to 2 decimal places.) Direct labor time per unit (hours) Total direct labor-hours needed Direct labor cost per hour Total direct labor cost Rordan Corporation Direct Labor Budget 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Year
Exercise 8-4 (Algo) Direct Labor Budget [LO8-5] The production manager of Rordan Corporation has submitted the following quarterly production forecast for the upcoming fiscal year: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 10,600 8,500 Units to be produced 7,000 11,100 Each unit requires 0.35 direct labor-hours, and direct laborers are paid $20.00 per hour. Required: 1. Prepare the company's direct labor budget for the upcoming fiscal year. (Round "Direct labor time per unit (hours)" answers to 2 decimal places.) Direct labor time per unit (hours) Total direct labor-hours needed Direct labor cost per hour Total direct labor cost 1st Quarter Rordan Corporation Direct Labor Budget 2nd Quarter 3rd Quarter 4th Quarter Year
Exercise 4 (Direct Labor Budget) The Production Department of the Laguna Plant of JC Corporation has submitted the following forecast of units to be produced at the plant for each quarter of the upcoming fiscal year. The plant produces high-end outdoor barbeque grills. 1st quarter 2 quarter 3rd quarter 4 quarter Units to be produced... 5,000 4,400 4,500 4,900 Each unit requires 0.40 direct labor-hours and direct labor-hour workers paid P11 per hour. Required: 1. Construct the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor work force is adjusted each quarter to match the number of hours required to produce the forecasted numberof unitsproduced. 2. Construct the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor work force is not adjusted each quarter. Instead, assume that the company's direct labor work force consists of \ permanent employees who are guaranteed to be paid for at least 1,800 hours of work…
Direct Labor Budget The production manager of Rordan Corporation has submitted the following quarterly production forecast for the upcoming fiscal year: Each unit requires 0.35 direct labor-hours, and direct laborers are paid $12.00 per hour. Required: 1. Using Schedule 4 as your guide, prepare the company’s direct labor budget for the upcoming fiscal year. Assume that the direct labor workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced. 2. Prepare the company’s direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is not adjusted each quarter. Instead, assume that the company’s direct labor workforce consists of permanent employees who are guaranteed to be paid for at least 2,600 hours of work each quarter. If the number of required direct labor-hours is less than this number, the workers are paid for 2,600 hours anyway. Any hours worked in excess of 2,600 hours in a quarter…
Exercise 8-15 (Algo) Direct Labor and Manufacturing Overhead Budgets [LO8-5, LO8-6] The Production Department of Hruska Corporation has submitted the following forecast of units to be produced by quarter for the upcoming fiscal year: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Units to be produced 10,800 9,800 11,800 12,800 Each unit requires 0.25 direct labor-hours and direct laborers are paid $13.00 per hour. In addition, the variable manufacturing overhead rate is $1.90 per direct labor-hour. The fixed manufacturing overhead is $88,000 per quarter. The only noncash element of manufacturing overhead is depreciation, which is $28,000 per quarter. Required: 1. Calculate the company’s total estimated direct labor cost for each quarter of the the upcoming fiscal year and for the year as a whole. 2&3. Calculate the company’s total estimated manufacturing overhead cost and the cash disbursements for manufacturing overhead for each quarter of the upcoming fiscal…
Exercise 5 (Manufacturing Overhead Budget) The direct labor budget of Kiko Corporation for the upcoming fiscal year contains the following details concerning budgeted direct labor-hours. 1s' quarter 2nd quarter 3rd quarter 4th quarter Budgeted direct labor- hours 5,000 4,800 5,200 5,400 The company's variable manufacturing overhead rate is P1.75 per direct labor- hour and the company's fixed manufacturing overhead is P35,000 per quarter. The only noncash item included in the fixed manufacturing overhead is depreciation, which is P15,000 per quarter. Required: 1. Construct the company's manufacturing overhead budget for the upcoming fiscal year. 2. Compute the company's manufacturing overhead rate (including both variable and fixed manufacturing overhead) for the upcoming fiscal year. Round off to the nearest whole centavos.