Question

2. The sales forecast for Moss follows: January = 5,000 February = 5,200 March = 5,600...

2. The sales forecast for Moss follows:

January = 5,000

February = 5,200

March = 5,600

April = 6,000

May = 6,500

June = 7,000

July = 7,500

August = 7,000

(i). Company policy is to keep a target ending inventory of 20% of the next month’s sales. Prepare a production budget for April, may and June.

(ii). Using the information from part (i), prepare a labor usage and purchases budget. It requires 3 hours at $18 per hour.

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Production budget :

April May June
Sales 6000 6500 7000
Add: Desired ending inventory 1300 1400 1500
Total 7300 7900 8500
Less; Beginning inventory -1200 -1300 -1400
Production units 6100 6600 7100

2) Labour budget :

April May June
Production units 6100 6600 7100
Labour hour per unit 3 3 3
Production labour hour 18300 19800 21300
Rate per hour 18 18 18
Direct labour cost 329400 356400 383400

Note : we could not prepare purchase budget without any information of direct material

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Young is a retailer of assorted baby products. The sales forecast for the coming months is:...
Young is a retailer of assorted baby products. The sales forecast for the coming months is: Revenues April $ 181,000 May $ 209,000 June $ 217,000 July $ 249,000 August $ 233,000 Young’s cost of sales averages 80% of revenues. The inventory policy is to carry 20% of next month’s sales needs. April 1 inventory will be as expected under the policy. Young pays for purchases 70% in the month of purchase and 30% the following month. Accounts payable on...
1. Petite Martinique Ltd. Had sales of 49,769 in March and 59,902 in April. Forecast sales...
1. Petite Martinique Ltd. Had sales of 49,769 in March and 59,902 in April. Forecast sales for May, June and July are 69,969, 84,513 and 99,931, respectively. The firm has a cash balance of $2,000 on May 1 and wishes to maintain a minimum cash balance of $5,000. Given the following data, prepare and interpret a cash budget for the months of May, June and July. 1) The firm makes 17% of sales for cash, 57% are collected in the...
The Volt Battery Company has forecast its sales in units as follows: January 2,200 May 2,750...
The Volt Battery Company has forecast its sales in units as follows: January 2,200 May 2,750 February 2,050 June 2,900 March 2,000 July 2,600 April 2,500 Volt Battery always keeps an ending inventory equal to 120% of the next month’s expected sales. The ending inventory for December (January’s beginning inventory) is 2,640 units, which is consistent with this policy. Materials cost $11 per unit and are paid for in the month after purchase. Labor cost is $4 per unit and...
Cash budget-Basic. Grenoble Enterprises had sales of $50,000 in March and $60,400 in April. Forecast sales...
Cash budget-Basic. Grenoble Enterprises had sales of $50,000 in March and $60,400 in April. Forecast sales for​ May, June, and July are $69,900​, $79,600​, and ​$100,300, respectively. The firm has a cash balance of $4,500 on May 1 and wishes to maintain a minimum cash balance of $4,500. Given the following​ data, prepare and interpret a cash budget for the months of​ May, June, and July. ​ (1) The firm makes 18% of sales for​ cash, 62% are collected in...
The Ace Battery Company has forecast its sales in units as follows:   January 1,500 May 2,050...
The Ace Battery Company has forecast its sales in units as follows:   January 1,500 May 2,050   February 1,350 June 2,200   March 1,300 July 1,900   April 1,800 Ace always keeps an ending inventory equal to 130 percent of the next month's expected sales. The ending inventory for December (January's beginning inventory) is 1,950 units, which is consistent with this policy. Materials cost $10 per unit and are paid for in the month after production. Labour cost is $3 per unit and...
Osage, Inc., has actual sales for May and June and forecast sales for July, August, September,...
Osage, Inc., has actual sales for May and June and forecast sales for July, August, September, and October as follows: Actual: May 5,930 units June 6,240 units Forecast: July 5,910 units August 6,890 units September 5,630 units October 5,210 units Required: a. The firm’s policy is to have finished goods inventory on hand at the end of the month that is equal to 70% of the next month’s sales. It is currently estimated that there will be 4,137 units on...
The PM Company has planned the following sales for the next three months: January February March...
The PM Company has planned the following sales for the next three months: January February March Budgeted Sales $40,000 $50,000 $70,000 Sales are made 20% for cash and 80% on account (A/R). From experience, the company has learned that a month's sales on account are collected according to the following pattern: Month of sale: 60% First month following sale: 30% Second month following sale: 8% Uncollectible: 2% The following additional information has been provided for March: Inventory purchases (70% paid...
The monthly sales for Yazici Batteries, Inc., were as follows: MONTH SALES January 20 February 21...
The monthly sales for Yazici Batteries, Inc., were as follows: MONTH SALES January 20 February 21 March 15 April 14 May 13 June 16 July 17 August 18 September 20 October 20 November 21 December 23 Plot the monthly sales data. Forecast January sales using each of the following: Naive method. A 3-month moving average. A 6-month weighted average using .1, .1, .1, .2, .2, and .3, with the heaviest weights applied to the most recent months. Exponential smoothing using...
The sales budget for Perrier Inc. is forecasted as follows: Month Sales Revenue May $130,000 June...
The sales budget for Perrier Inc. is forecasted as follows: Month Sales Revenue May $130,000 June 150,000 July 200,000 August 130,000 To prepare a cash budget, the company must determine the budgeted cash collections from sales. Historically, the following trend has been established regarding the cash collection of sales: 60 percent in the month of sale. 20 percent in the month following sale. 15 percent in the second month following sale. 5 percent uncollectible. The company gives a 2 percent...
Ballan Inc. estimates its units sales for the coming months to be as follows:                  ...
Ballan Inc. estimates its units sales for the coming months to be as follows:                   March       280,000          April       260,000          May         250,000          June        230,000          July        240,000          August      225,000 Ballan maintains inventory at budgeted sales needs for the next month. March 1 inventory will be 248,000 units.      How much is the purchases for March? How much is the purchases for April?    How much is the purchases for May? How much is the purchases for June?...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT