Question

Company expects to produce and sell12,000 units for $80 DM costs are $8 DL is $40...

Company expects to produce and sell12,000 units for $80
DM costs are $8
DL is $40
MOH is $12 per unit
                                                    Beginning inventory                                Target Ending inventory
Finished goods inventory           800 units                                           1000 units

On the 2020 budgeted income statement, what amount will be reported for sales? (4 points)

A.

$960,000

B.

$860,000

C.

$80,000

D.

$24,000

Company expects to produce and sell12,000 units for $80

DM costs are $8
DL is $40
MOH is $12 per unit
                                                    Beginning inventory                                Target Ending inventory
Finished goods inventory           800 units                                           1000 units

How many units need to be produced in 2020?

A.

12,200 units

B.

13,000 units

C.

12,000 units

D.

12,800 units

Company expects to produce and sell12,000 units for $80

DM costs are $8

DL is $40

MOH is $12 per unit

                                                    Beginning inventory                                Target Ending inventory

Finished goods inventory           800 units                                               1000 units

On the 2020budgeted income statement, what amount will be reported for cost of goods sold?

A.

$720,000

B.

$732,000

C.

$600,000

D.

$480,000

Company expects to produce and sell12,000 units for $80

DM costs are $8

DL is $40

MOH is $12 per unit

                                                    Beginning inventory                                Target Ending inventory

Finished goods inventory           800 units                                               1000 units

What are the 2020 budgeted costs for direct materials, direct manufacturing labor, and manufacturing overhead, respectively?

A.

$97,600; 488,000; 146,400

B.

$96,000; 480,000; 144,000

C.

$24,400; 122,000; 36,600

D.

$80,000, 40,000; 120,000

Company developed standard costs for direct material and direct labor. In 2020, Company estimated the following standard costs for one of their major products, the plastic container.
                Budgeted quantity                                                      Budgeted price
                Direct materials 0.25 pounds            $30 per pound  

                Direct labor       0.13 hours                                    $16per hour     

Actual
During July, Company produced and sold 5,000 containers using

1,100 pounds of direct materials at an average cost per pound of $29 and

600 direct manufacturing labor hours at an average wage of $15 per hour.

Direct Material Flexible - Budget variance is

A.

$1,100 F

B.

$5,600U

C.

$5,600 F

D.

$1,100U
Business   Accounting   
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Homework Answers

Answer #1

1. Sales = Sales Units * Selling price per unit = 12000 * $ 80 = $ 9,60,000 (option A)

2. Units to be produced = Sales Units + Target Ending Inventory - Beginning Inventory

= 12000+1000 -800 = 12200 units (option A)

3. Cost of Goods sold = Sales Units * (DM + DL + MOH)

= 12000 (8 + 40+ 12) = 12000 * 60 = $ 7,20,000 (Option A)

4. Budgeted Direct Materials = Units produced * DM per unit = 12200 units * 8 = $ 97,600

Budgeted Direct Labour = Units produced * DL per unit = 12200 units * 40 = $ 4,88,000

Budgeted MOH = Units produced * MOH per unit = 12200 Units *12 = $ 1,46,400 (Option A)

5. Direct Material Flexible Budget Variance = Standard Cost - Actual Cost

= 5000*0.25*30 - 1100*29 = 37500 - 31900 = 5,600 F (Option C)

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