Exercise 8-3 (Algo) Direct Materials Budget (LO8-4] Two grams of musk oil are required for each bottle of Mink Caress, a very popular perfume made by a small company in western Siberia. The cost of the musk oil is $2.20 per gram. Budgeted production of Mink Caress is given below by quarters for Year 2 and for the first quarter of Year 3: Budgeted production, in bottles Year 2 First 86,000 Second 116,000 Third 176,000 Fourth 126,000 Year 3 First 96,000 The inventory of musk oil at the end of a quarter must be equal to 20% of the following quarter's production needs. Some 34,400 grams of musk oil will be on hand to start the first quarter of Year 2. Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production Total units of raw materials needed Units of raw materials to be purchased Unit cost of raw materials Mink Caress Direct Materials Budget - Year 2 First Quarter Second Quarter Third Quarter Fourth Quarter Year

Exercise 8-3 (Algo) Direct Materials Budget (LO8-4] Two grams of musk oil are required for each bottle of Mink Caress, a very popular perfume made by a small company in western Siberia. The cost of the musk oil is $2.20 per gram. Budgeted production of Mink Caress is given below by quarters for Year 2 and for the first quarter of Year 3: Budgeted production, in bottles Year 2 First 86,000 Second 116,000 Third 176,000 Fourth 126,000 Year 3 First 96,000 The inventory of musk oil at the end of a quarter must be equal to 20% of the following quarter's production needs. Some 34,400 grams of musk oil will be on hand to start the first quarter of Year 2. Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production Total units of raw materials needed Units of raw materials to be purchased Unit cost of raw materials Mink Caress Direct Materials Budget - Year 2 First Quarter Second Quarter Third Quarter Fourth Quarter Year

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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Exercise 8-3 (Algo) Direct Materials Budget [LO8-4] Three grams of musk oil are required for each bottle of Mink Caress, a popular perfume made by a company in western Siberia. The cost of the musk oil is $2.20 per gram. Budgeted quarterly production of Mink Caress is given below for Year 2 and the first quarter of Year 3: Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production First 72,000 Total units of raw materials needed Year 2 Units of raw materials to be purchased Unit cost of raw materials Cost of raw materials to purchased Second 102,000 Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Budgeted production, in bottles The inventory of musk oil at the end of a quarter must equal 20% of the following quarter's production needs. A total of 43,200 grams of musk oil will be on hand to start the first quarter of Year 2. Third 162,000 Mink Caress Direct Materials Budget - Year 2 First…
Exercise 8-3 (Algo) Direct Materials Budget [LO8-4) Four grams of musk oil are required for each bottle of Mink Caress, a popular perfume made by a company in western Siberia. The cost of the musk oil is $170 per gram. Budgeted quarterly production of Mink Caress is given below for Year 2 and the first quarter of Year 3: First 92,000 Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production Total units of raw materials needed Year 2 Units of raw materials to be purchased Unit cost of raw materials Cost of raw materials to purchased Second 122,000 Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Budgeted production, in bottles The inventory of musk oil at the end of a quarter must equal 20% of the following quarter's production needs. A total of 73,600 grams of musk oil will be on hand to start the first quarter of Year 2. Third 182,000 Mink Caress Direct Materials Budget-Year 2 First Fourth…
Exercise 8-3 (Algo) Direct Materials Budget [LO8-4] Four grams of musk oil are required for each bottle of Mink Caress, a very popular perfume made by a small company in western Siberia. The cost of the musk oil is $1.50 per gram. Budgeted production of Mink Caress is given below by quarters for Year 2 and for the first quarter of Year 3: Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production First 88,000 Total units of raw materials needed Units of raw materials to be purchased Unit cost of raw materials Cost of raw materials to purchased Second 118,000 Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Year 2 Budgeted production, in bottles The inventory of musk oil at the end of a quarter must be equal to 20% of the following quarter's production needs. Some 70,400 grams of musk oil will be on hand to start the first quarter of Year 2. First Third 178,000 Mink Caress Direct Materials…
Problem 8-24 (Algo) Cash Budget with Supporting Schedules (LO8-2, LO8-4, LO8-8] Garden Sales, Incorporated, usually has to borrow money during the second quarter to support peak sales of lawn care equipment during May. It gathered the following information to prepare a cash budget for the quarter: a. Budgeted monthly absorption costing income statements for April-July are: April May June July Sales Cost of goods sold $ 660,000 462,000 Gross margin Selling and administrative expenses: Selling expense Administrative expense* Total selling and administrative expenses Net operating income 198,000 $ 830,000 581,000 249,000 $ 540,000 378,000 $ 440,000 308,000 162,000 132,000 84,000 103,000 65,000 44,000 47,000 131,000 63,200 166,200 39,800 104,800 42,000 86,000 $ 67,000 $ 82,800 $ 57,200 $ 46,000 *Includes $26,000 of depreciation each month. b. Sales are 20% for cash and 80% on account. c. Sales on account are collected over a three-month period with 10% collected in the month of sale, 70%…
Exercise 8-3 (Static) Direct Materials Budget [LO8-4] Three grams of musk oil are required for each bottle of Mink Caress, a popular perfume made by a company in western Siberia. The cost of the musk oil is $1.50 per gram. Budgeted quarterly production of Mink Caress is given below for Year 2 and the first quarter of Year 3: Budgeted production, in bottles Year 2 First 60,000 Second 90,000 Third 150,000 Fourth 100,000 Year 3 First 70,000 The inventory of musk oil at the end of a quarter must equal 20% of the following quarter's production needs. A total of 36,000 grams of musk oil will be on hand to start the first quarter of Year 2. Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production Add: Units of beginning raw materials inventory Total units of raw materials needed Units of raw materials to be purchased Unit cost of raw materials Cost of…
SB Exercise E8-5 to E8-10 [The following information applies to the questions displayed below.] Shadee Corporation expects to sell 600 sun shades in May and 410 in June. Each shade sells for $152. Shadee's beginning and ending finished goods inventories for May are 80 and 45 shades, respectively. Ending finished goods inventory for June will be 65 shades. E8-6 (Algo) Preparing Direct Materials Purchases Budget [LO 8-3c, e] Each shade requires a total of $45.00 in direct materials that includes 4 adjustable poles that cost $5.00 each. Shadee expects to have 130 in direct materials inventory on May 1, 90 poles in inventory on May 31, and 110 poles in inventory on June 30. Required: Prepare Shadee's May and June purchases budget for the adjustable poles. Budgeted Cost of Poles Purchased May June
Exercise 8-8 (Algo) Budgeted Income Statement (LO8-9] Gig Harbor Boating is the wholesale distributor of a small recreational catamaran sailboat. Management has prepared the following summary data to use in its annual budgeting process: Budgeted unit sales. Selling price per unit Cost per unit Variable selling and administrative expense (per unit) Fixed selling and administrative expense (per year) Interest expense for the year Required: Prepare the company's budgeted income statement for the year. Gig Harbor Boating Budgeted Income Statement 680 $ 2,060 $1,680 $50 $ 200,000 $ 22,000
SB Exercise E8-5 to E8-10 [The following information applies to the questions displayed below.] Shadee Corporation expects to sell 570 sun shades in May and 400 in June. Each shade sells for $143. Shadee's beginning and ending finished goods inventories for May are 65 and 50 shades, respectively. Ending finished goods inventory for June will be 60 shades. E8-10 (Algo) Preparing Budgeted Income Statement [LO 8-3h] Each shade requires a total of $50.00 in direct materials that includes 4 adjustable poles that cost $10.00 each. Shadee expects to have 130 in direct materials inventory on May 1, 100 poles in inventory on May 31, and 110 poles in inventory on June 30. Suppose that each shade takes three direct labor hour to produce and Shadee pays its workers $14 per hour. Additionally, Shadee's fixed manufacturing overhead is $9,000 per month, and variable manufacturing overhead is $10 per unit produced. Additional information: Selling costs are expected to be 9 percent of sales. Fixed…
Problem 8-24 (Algo) Cash Budget with Supporting Schedules [LO8-2, LO8-4, LO8-8] Garden Sales, Inc., sells garden supplies. Management is planning its cash needs for the second quarter. The company usually has to borrow money during this quarter to support peak sales of lawn care equipment, which occur during May. The following information has been assembled to assist in preparing a cash budget for the quarter: Budgeted monthly absorption costing income statements for April–July are: April May June July Sales $ 570,000 $ 770,000 $ 470,000 $ 370,000 Cost of goods sold 399,000 539,000 329,000 259,000 Gross margin 171,000 231,000 141,000 111,000 Selling and administrative expenses: Selling expense 77,000 97,000 58,000 37,000 Administrative expense* 43,500 58,400 36,200 35,000 Total selling and administrative expenses 120,500 155,400 94,200 72,000 Net operating income $ 50,500 $ 75,600 $ 46,800 $ 39,000…
Required information SB Exercise E8-5 to E8-10 [The following information applies to the questions displayed below.] Shadee Corporation expects to sell 560 sun shades in May and 350 in June. Each shade sells for $142. Shadee's beginning and ending finished goods inventories for May are 70 and 50 shades, respectively. Ending finished goods inventory for June will be 55 shades. E8-10 (Algo) Preparing Budgeted Income Statement [LO 8-3h] Each shade requires a total of $50.00 in direct materials that includes 4 adjustable poles that cost $5.00 each. Shadee expects to have 120 in direct materials inventory on May 1, 100 poles in inventory on May 31, and 110 poles in inventory on June 30. Suppose that each shade takes three direct labor hour to produce and Shadee pays its workers $13 per hour. Additionally, Shadee's fixed manufacturing overhead is $10,000 per month, and variable manufacturing overhead is $15 per unit produced. Additional information: . Selling costs are expected to be 10…
Problem 8-24 (Algo) Cash Budget with Supporting Schedules [LO8-2, LO8-4, LO8-8] Garden Sales, Inc., sells garden supplies. Management is planning its cash needs for the second quarter. The company usually has to borrow money during this quarter to support peak sales of lawn care equipment, which occur during May. The following information has been assembled to assist in preparing a cash budget for the quarter: Budgeted monthly absorption costing income statements for April–July are: April May June July Sales $ 570,000 $ 770,000 $ 470,000 $ 370,000 Cost of goods sold 399,000 539,000 329,000 259,000 Gross margin 171,000 231,000 141,000 111,000 Selling and administrative expenses: Selling expense 77,000 97,000 58,000 37,000 Administrative expense* 43,500 58,400 36,200 35,000 Total selling and administrative expenses 120,500 155,400 94,200 72,000 Net operating income $ 50,500 $ 75,600 $ 46,800 $ 39,000…
Required information SB Exercise E8-5 to E8-10 [The following information applies to the questions displayed below.] Shadee Corporation expects to sell 570 sun shades in May and 330 in June. Each shade sells for $162. Shadee's beginning and ending finished goods inventories for May are 70 and 55 shades, respectively. Ending finished goods inventory for June will be 55 shades. E8-10 (Algo) Preparing Budgeted Income Statement [LO 8-3h] Each shade requires a total of $55.00 in direct materials that includes 4 adjustable poles that cost $5.00 each. Shadee expects to have 120 in direct materials inventory on May 1, 90 poles in inventory on May 31, and 100 poles in inventory on June 30. Suppose that each shade takes three direct labor hour to produce and Shadee pays its workers $15 per hour. Additionally, Shadee's fixed manufacturing overhead is $11,000 per month, and variable manufacturing overhead is $14 per unit produced. Additional information: • Selling costs are expected to be 8…