Purchases budget. Lirect Labor Budget Crescent Company produces stuffed toy animals; one of these is "Arabeau the Cow." Each Arabeau takes 0.20 yard of fabric (white with irregular black splotches) and 10 ounces of polyfiberfill. Fabric costs $3.40 per yard and polyfiberfill is $0.05 per ounce. Crescent has budgeted production of Arabeaus for the next four months as follows: Units October 44,000 November 80,000 December 50,000 January 40,000 Inventory policy requires that sufficient fabric be in ending monthly inventory to satisfy 20 percent of the following month's production needs and sufficient polyfiberfill be in inventory to satisfy 40 percent of the following month's production needs. Inventory of fabric and polyfiberfill at the beginning of October equals exactly the amount needed to satisfy the inventory policy. Each Arabeau produced requires (on average) 0.10 direct labor hour. The average cost of direct labor is $16 per hour. Required: 1. Prepare a direct materials purchases budget of fabric for the last quarter of the year showing purchases in units and in dollars for each month and for the quarter in total. Round your answers to the nearest cent, if required. Crescent Company Direct Materials Purchases Budget for Fabric For the Fourth Quarter October November December Total Units produced DM per unit (yd.) Production needs Desired ending inventory (yd.) Total needed Less: Beginning inventory DM to be purchased (yd.) Cost per yard Total purchase cost
Purchases budget. Lirect Labor Budget Crescent Company produces stuffed toy animals; one of these is "Arabeau the Cow." Each Arabeau takes 0.20 yard of fabric (white with irregular black splotches) and 10 ounces of polyfiberfill. Fabric costs $3.40 per yard and polyfiberfill is $0.05 per ounce. Crescent has budgeted production of Arabeaus for the next four months as follows: Units October 44,000 November 80,000 December 50,000 January 40,000 Inventory policy requires that sufficient fabric be in ending monthly inventory to satisfy 20 percent of the following month's production needs and sufficient polyfiberfill be in inventory to satisfy 40 percent of the following month's production needs. Inventory of fabric and polyfiberfill at the beginning of October equals exactly the amount needed to satisfy the inventory policy. Each Arabeau produced requires (on average) 0.10 direct labor hour. The average cost of direct labor is $16 per hour. Required: 1. Prepare a direct materials purchases budget of fabric for the last quarter of the year showing purchases in units and in dollars for each month and for the quarter in total. Round your answers to the nearest cent, if required. Crescent Company Direct Materials Purchases Budget for Fabric For the Fourth Quarter October November December Total Units produced DM per unit (yd.) Production needs Desired ending inventory (yd.) Total needed Less: Beginning inventory DM to be purchased (yd.) Cost per yard Total purchase cost
Cornerstones of Cost Management (Cornerstones Series)
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Author:Don R. Hansen, Maryanne M. Mowen
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Chapter8: Budgeting For Planning And Control
Section: Chapter Questions
Problem 17E: Crescent Company produces stuffed toy animals; one of these is Arabeau the Cow. Each Arabeau takes...
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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.
Question
Direct Materials Purchases Budget: Direct Labor Budget
Transcribed Image Text:Direct Materials Purchases Budget: Direct Labor Budget
Crescent Company produces stuffed toy animals; one of these is "Arabeau the Cow." Each Arabeau takes 0.20 yard of fabric (white with irregular black splotches) and 10 ounces of polyfiberfill. Fabric costs $3.40 per yard and polyfiberfill is $0.05
per ounce. Crescent has budgeted production of Arabeaus for the next four months as follows:
Units
October
44,000
November
80,000
December
50,000
January
40,000
Inventory policy requires that sufficient fabric be in ending monthly inventory to satisfy 20 percent of the following month's production needs and sufficient polyfiberfill be in inventory to satisfy 40 percent of the following month's production needs.
Inventory of fabric and polyfiberfill at the beginning of October equals exactly the amount needed to satisfy the inventory policy.
Each Arabeau produced requires (on average) 0.10 direct labor hour. The average cost of direct labor is $16 per hour.
Required:
1. Prepare a direct materials purchases budget of fabric for the last quarter of the year showing purchases in units and in dollars for each month and for the quarter in total. Round your answers to the nearest cent, if required.
Crescent Company
Direct Materials Purchases Budget for Fabric
For the Fourth Quarter
October November December
Total
Units produced
DM per unit (yd.)
Production needs
Desired ending inventory (yd.)
Total needed
Less: Beginning inventory
DM to be purchased (yd.)
Cost per yard
Total purchase cost
Transcribed Image Text:2. Prepare a direct materials purchases budget of polyfiberfill for the last quarter of the year showing purchases in units and in dollars for each month and for the quarter in total. Round your answers to the nearest cent, if required.
Crescent Company
Direct Materials Purchases Budget for Polyfiberfill
For the Fourth Quarter
October November December
Total
Units produced
DM per unit (oz.)
Production needs
Desired ending inventory (oz.)
Total needed
Less: Beginning inventory
DM to be purchased (oz.)
Cost per ounce
Total purchase cost
3. Prepare a direct labor budget for the last quarter of the year showing the hours needed and the direct labor cost for each month and for the quarter in total. Round your answers to the nearest cent, if required.
Crescent Company
Direct Labor Budget
For the Fourth Quarter
October November December
Total
Units produced
Direct labor time per unit (hours)
Direct labor hours needed
Cost per direct labor hour
$
Total direct labor cost
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