Shadee Corp. expects to sell 530 sun visors in May and 340 in June. Each visor sells for $18. Shadee's beginning and ending finished goods inventories for May are 70 and 55 units, respectively. Ending finished goods inventory for June will be 55 units. Each visor requires a total of $4.00 in direct materials that includes an adjustable closure that the company purchases from a supplier at a cost of $2.00 each. Shadee wants to have 31 closures on hand on May 1, 19 closures on May 31, and 27 closures on June 30 and variable manufacturing overhead is $1.75 per unit produced. Suppose that each visor takes 0.20 direct labor hours to produce and Shadee pays its workers $7 per hour. Additional information: • Selling costs are expected to be 11 percent of sales. Fixed administrative expenses per month total $1,400. Required: Complete Shadee's budgeted income statement for the months of May and June. (Note: Assume that fixed overhead per unit is $4.00.) (Do not round your intermediate calculations. Round your answers to 2 decimal places.) Budgeted Gross Margin SHADEE CORP. Budgeted Income Statement Budgeted Net Operating Income May June
Shadee Corp. expects to sell 530 sun visors in May and 340 in June. Each visor sells for $18. Shadee's beginning and ending finished goods inventories for May are 70 and 55 units, respectively. Ending finished goods inventory for June will be 55 units. Each visor requires a total of $4.00 in direct materials that includes an adjustable closure that the company purchases from a supplier at a cost of $2.00 each. Shadee wants to have 31 closures on hand on May 1, 19 closures on May 31, and 27 closures on June 30 and variable manufacturing overhead is $1.75 per unit produced. Suppose that each visor takes 0.20 direct labor hours to produce and Shadee pays its workers $7 per hour. Additional information: • Selling costs are expected to be 11 percent of sales. Fixed administrative expenses per month total $1,400. Required: Complete Shadee's budgeted income statement for the months of May and June. (Note: Assume that fixed overhead per unit is $4.00.) (Do not round your intermediate calculations. Round your answers to 2 decimal places.) Budgeted Gross Margin SHADEE CORP. Budgeted Income Statement Budgeted Net Operating Income May June
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 17E: Crescent Company produces stuffed toy animals; one of these is Arabeau the Cow. Each Arabeau takes...
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