Blossom Company's sales budget projects unit sales of part 1987 of 10,700 units in January, 12,200 units in February, and 13,000 units in March. Each unit of part 1987 requires 3 pounds of materials, which cost $4 per pound. Blossom Company desires its ending raw materials inventory to equal 40% of the next month's production requirements, and its ending finished goods inventory to equal 20% of the next month's expected unit sales. These goals were met at December 31, 2019. (a) Prepare a production budget for January and February 2020. 4: 7:1 BLOSSOM COMPANY Production Budget January February

Blossom Company's sales budget projects unit sales of part 1987 of 10,700 units in January, 12,200 units in February, and 13,000 units in March. Each unit of part 1987 requires 3 pounds of materials, which cost $4 per pound. Blossom Company desires its ending raw materials inventory to equal 40% of the next month's production requirements, and its ending finished goods inventory to equal 20% of the next month's expected unit sales. These goals were met at December 31, 2019. (a) Prepare a production budget for January and February 2020. 4: 7:1 BLOSSOM COMPANY Production Budget January February

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Evanson Company expects to produce 564,000 units of their product during the year. Monthly production is expected to range from 40,000 to 80,000 units. The company has budgeted manufacturing costs per unit to be as follows: Direct materials $ 20 Direct labor 21 Variable manufacturing overhead 22 Fixed manufacturing overhead 3 Prepare a flexible manufacturing budget using 20,000 unit increments.
The master budget at Western Company last period called for sales of 240,000 units at $8.00 each. The costs were estimated to be $4.00 variable per unit and $270,000O fixed. During the period, actual production and actual sales were 245,000 units. The selling price was $8.10 per unit. Variable costs were $4.75 per unit. Actual fixed costs were $270,000. Required: Prepare a flexible budget for Western. WESTERN COMPANY Flexible Budget 2$
ABC Company’s budgeted sales for June, July, and August are 13,000, 17,000, and 14,700 units respectively. The following cost behavior patterns are budgeted for ABC Company’s operating expenses each month: Fixed costs: salaries, $2,500; rent, $5,500; depreciation, $2,900; advertising, $3,700 Mixed costs: utilities, $3,500 + $0.40 per unit Variable costs per unit sold: sales commissions, $2.50; marketing promotions, $1.50; supplies, $0.45; bad debt expense, $0.20 Required: Prepare ABC Company’s operating expense budget for June, July, and August. Note: Enter all values as positive value.
Budgeted sales for June amounted to 18,000 units. During the production process, it is usually found that 5% of production units are scrapped as defective and this loss occurs after the raw materials have been placed in process. Required: -How many kilograms of raw materials will be purchased in June? -Assume that the cost of a kilogram of raw material is P16 and that 60% of purchases is paid in the month of purchase while the remaining in the month after the purchase, how much is the cash payment for the June?
Phoenix Company reports the following fixed budget. It is based on an expected production and sales volume of 15,200 units. Sales Costs Direct materials Direct labor PHOENIX COMPANY Fixed Budget For Year Ended December 31 Sales staff commissions Depreciation-Machinery. Supervisory salaries Shipping Sales staff salaries (fixed annual amount) Administrative salaries Depreciation-office equipment Income $ 3,040,000 1,003, 200 212,800 45,600 295,000 202,000 228,000 246,000 457,400 198,000 $ 152,000 Problem 8-1A (Algo) Preparing and analyzing a flexible budget LO P1 Required: 1&2. Prepare flexible budgets at sales volumes of 14,200 and 16,200 units. 3. The company's business conditions are improving. One possible result is a sales volume of 18,200 units. Prepare a simple budgeted income statement if 18,200 units are sold. Complete this question by entering your answers in the tabs below.
The master budget at Cherrylawn Corporation at the beginning of the year was based on sales of 275,000 units with revenues of $3,300,000. Total variable costs were budgeted at $1,925,000 and fixed costs at $950,000. During the period, actual production and actual sales were 255,000 units. The actual revenues were $3,442,500. Actual variable costs were $6.50 per unit. Actual fixed costs were $980,000. Required: Prepare a profit variance analysis. Specifically Sales Price Variance, Sales Activity Variance, and the Master Budget. Note: Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.
The master budget at Cherrylawn Corporation at the beginning of the year was based on sales of 275,000 units with revenues of $3,300,000. Total variable costs were budgeted at $1,925,000 and fixed costs at $950,000. During the period, actual production and actual sales were 255,000 units. The actual revenues were $3,442,500. Actual variable costs were $6.50 per unit. Actual fixed costs were $980,000. Required: Prepare a flexible budget for Cherrylawn Corporation.
The production supervisor of the Machining Department for Niland Company agreed to the following monthly static budget for the upcoming year: Niland CompanyMachining DepartmentMonthly Production Budget Wages $447,000 Utilities 20,000 Depreciation 33,000 Total $500,000 The actual amount spent and the actual units produced in the first three months in the Machining Department were as follows: Amount Spent Units Produced January $471,000 82,000 February 445,000 74,000 March 425,000 67,000 The Machining Department supervisor has been very pleased with this performance because actual expenditures for January–March have been less than the monthly static budget of $500,000. However, the plant manager believes that the budget should not remain fixed for every month but should “flex” or adjust to the volume of work that is produced in the Machining Department. Additional budget information for the Machining Department is as follows: Wages per hour…
The master budget at Western Company last period called for sales of 225,000 units at $9 each. The costs were estimated to be $3.75 variable per unit and $225,000 fixed. During the period, actual production and actual sales were 230,000 units. The selling price was $9.10 per unit. Variable costs were $4.50 per unit. Actual fixed costs were $225,000. Required: Prepare a flexible budget for Western.
Clarks Company's master budget includes $360,000 for equipment depreciation. The master budget was prepared for an annual volume of 120,000 chargeable hours. This volume is expected to occur uniformly throughout the year. During September Clark performed 9,000 chargeable hours and recorded $28,000 of depreciation. Determine the flexible budget amount for equipment depreciation in September?
Electro Company budgets production of 700,000 electric panels in the second quarter and 770,000 electric panels in the third quarter. Each panel requires 0.80 pound of direct material at a cost of $2.30 per pound. The company desires to end each quarter with an ending inventory of this material equal to 20% of next quarter's budgeted materials requirements. Beginning inventory of this material is 112,000 pounds. Prepare a direct materials budget for the second quarter.
Evanson Company expects to produce 576,000 units of their product during the year. Monthly production is expected to range from 40,000 to 80,000 units. The company has budgeted manufacturing costs per unit to be as follows: Direct materials $ 23 Direct labor 24 Variable manufacturing overhead 25 Fixed manufacturing overhead 3 Prepare a flexible manufacturing budget using 20,000 unit increments. Evanson Company Monthly Flexible Manufacturing Budget Activity level Finished units Variable costs Direct materials Direct labor Overhead Total variable costs Fixed costs Total fixed costs Total costs