Greiner Company makes and sells high-quality glare filters for microcomputer monitors. John Craven, controller, is responsible for preparing Greiner's master budget and has assembled the following data for the coming year. The direct labor rate includes wages, all employee related benefits, and the employer's share of FICA. Labor saving machinery will be fully operational by March. Also, as of March 1, the company's union contract calls for an increase in direct labor wages that is included in the direct labor rate. Greiner expects to have 5,600 filters in inventory on December 31 of the current year, and has a policy of carrying 35 percent of the following month's projected sales in inventory. Information on the first four months of the coming year is as follows: January February March April Estimated unit sales 35,800 35,600 39,800 40,800 Sales price per unit $83 $83 $75 $75 Direct labor hours per unit 2.80 2.80 2.50 2.50 Direct labor hourly rate $17 $17 $18 $18 Direct materials cost per unit $9 $9 $9 $9 Required: Unless otherwise indicated, round all calculated amounts to the nearest dollar or unit. 1. Prepare the following monthly budgets for Greiner Company for the first quarter of the coming year. a. Production budget in units: Greiner Company Production Budget (units) For the First Quarter of the Coming Year January February March Total Unit sales Desired ending inventory Total units required Less: Beginning inventory Units produced b. Direct labor budget in hours: Round your answers to two decimal places, if required. Greiner Company Direct Labor Budget (hours) For the First Quarter of the Coming Year January February March Total Units produced Direct labor hours per unit Total labor budget (hours)
Greiner Company makes and sells high-quality glare filters for microcomputer monitors. John Craven, controller, is responsible for preparing Greiner's master budget and has assembled the following data for the coming year. The direct labor rate includes wages, all employee related benefits, and the employer's share of FICA. Labor saving machinery will be fully operational by March. Also, as of March 1, the company's union contract calls for an increase in direct labor wages that is included in the direct labor rate. Greiner expects to have 5,600 filters in inventory on December 31 of the current year, and has a policy of carrying 35 percent of the following month's projected sales in inventory. Information on the first four months of the coming year is as follows: January February March April Estimated unit sales 35,800 35,600 39,800 40,800 Sales price per unit $83 $83 $75 $75 Direct labor hours per unit 2.80 2.80 2.50 2.50 Direct labor hourly rate $17 $17 $18 $18 Direct materials cost per unit $9 $9 $9 $9 Required: Unless otherwise indicated, round all calculated amounts to the nearest dollar or unit. 1. Prepare the following monthly budgets for Greiner Company for the first quarter of the coming year. a. Production budget in units: Greiner Company Production Budget (units) For the First Quarter of the Coming Year January February March Total Unit sales Desired ending inventory Total units required Less: Beginning inventory Units produced b. Direct labor budget in hours: Round your answers to two decimal places, if required. Greiner Company Direct Labor Budget (hours) For the First Quarter of the Coming Year January February March Total Units produced Direct labor hours per unit Total labor budget (hours)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter8: Budgeting For Planning And Control
Section: Chapter Questions
Problem 38P: Greiner Company makes and sells high-quality glare filters for microcomputer monitors. John Craven,...
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Concept explainers
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
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Transcribed Image Text:Greiner Company makes and sells high-quality glare filters for microcomputer monitors. John Craven, controller, is responsible for preparing Greiner's master budget and has assembled the following data for the coming year. The direct labor rate includes wages, all employee-
related benefits, and the employer's share of FICA. Labor saving machinery will be fully operational by March. Also, as of March 1, the company's union contract calls for an increase in direct labor wages that is included in the direct labor rate. Greiner expects to have 5,600 glare
filters in inventory on December 31 of the current year, and has a policy of carrying 35 percent of the following month's projected sales in inventory. Information on the first four months of the coming year is as follows:
January February March April
Estimated unit sales
35,800
35,600 39,800 40,800
Sales price per unit
$83
$83
$75
$75
Direct labor hours per unit
2.80
2.80
2.50
2.50
Direct labor hourly rate
$17
$17
$18
$18
Direct materials cost per unit
$9
$9
$9
$9
Required:
Unless otherwise indicated, round all calculated amounts to the nearest dollar or unit.
1. Prepare the following monthly budgets for Greiner Company for the first quarter of the coming year.
a. Production budget in units:
Greiner Company
Production Budget (units)
For the First Quarter of the Coming Year
January
February March
Total
Unit sales
Desired ending inventory
Total units required
Less: Beginning inventory
Units produced
b. Direct labor budget in hours: Round your answers to two decimal places, if required.
Greiner Company
Direct Labor Budget (hours)
For the First Quarter of the Coming Year
January
February
March
Total
Units produced
Direct labor hours per unit
Total labor budget (hours)
Transcribed Image Text:c. Direct materials cost budget:
Greiner Company
Direct Materials Cost Budget
For the First Quarter of the Coming Year
January
February March
Total
|Units produced
Cost per unit
Total direct materials
d. Sales budget: Round unit selling price amounts to the nearest cent and use the same for subsequent requirements.
Greiner Company
Sales Budget (dollars)
For the First Quarter of the Coming Year
January
February
March
Total
Unit sales
Unit selling price
Total sales revenue
2. Calculate the total budgeted contribution margin for Greiner Company by month and in total for the first quarter of the coming year. (CMA adapted)
Greiner Company
Budgeted Contribution Margin
For the First Quarter of the Coming Year
January
February
March
Total
Sales revenue
Direct labor cost
Materials cost
Contribution margin $
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