Black & Decker (B&D) manufactures a wide variety of tools and accessories. One o
ID: 2374947 • Letter: B
Question
Black & Decker (B&D) manufactures a wide variety of tools and accessories. One of its more popular items is a cordless power handisaw. Use the following fictitious information about this product line to complete the problem requirements. Each handisaw sells for $50. B&D expects the following unit sales.
B&D's ending finished goods inventory policy is 20 percent of the next month's sales.
Suppose each handisaw takes approximately .75 hours to manufacture, and B&D pays an average labor wage of $15.50 per hour.
Each handisaw requires a plastic housing that B&D purchases from a supplier at a cost of $5.00 each. The company has an ending raw materials inventory policy of 10 percent of the following month's production requirements. Materials other than the housing unit total $4.00 per handisaw.
Manufacturing overhead for this product includes $72,000 annual fixed overhead (based on production of 24,000 units) and $.90 per unit variable manufacturing overhead. B&D's selling expenses are 4 percent of sales dollars, and administrative expenses are fixed at $15,000 per month.
Calculate the sales budget for Black & Decker (B&D) for the first quarter (January, February, and March). Include each month as well as the first quarter. (Omit the "$" sign in your response.)
Calculate the production budget for Black & Decker (B&D) for the first quarter (January, February, and March). Include each month as well as the first quarter.
Calculate the raw materials purchases budget for the plastic housings for Black & Decker (B&D) for the first quarter (January, February, and March). Include each month as well as the first quarter. (Omit the "$" sign in your response.)
Calculate the direct labor budget for Black & Decker (B&D) for the first quarter (January, February, and March). Include each month as well as the first quarter. (Round your answers to 2 decimal places. Omit the "$" sign in your response.)
January 2,300 February 2,400 March 2,800 April 2,900 May 2,200Explanation / Answer
January february march 1st quarter
COGS 38587.5 45187.5 55125 207900
2. Budegted 23040 24000 25200 72240
selling and administrative exp.
3.
sales revenue 84000 100000 120000 304000
COGS 38587.5 45187.5 55125 207900
gross profit 45412.5 54812.5 64875 96100
selling and 23040 24000 25200 72240
administrative ex
Budeget net 22372.5 30812.5 39675 23860
income
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