Jordan and Taylor are too busy baking brownies to schedule 1. Units to be produc
ID: 2418407 • Letter: J
Question
Jordan and Taylor are too busy baking brownies to schedule 1. Units to be produced annually: 200,000 tins Direct labor: 1 hour per 100 tins Variable overhead costs per direct labor hour: Indirect materials $2.05 Indirect labor $1.20 Plant Utilities $9.25 Factory Equipment Maintenance $3.50 Fixed overhead costs per quarter: Factory Worker's Insurance $3,000 Factory Equipment Depreciation $2,000 Plant Rent $12,000 What is the budgeted total manufacturing overhead for the year? 2. Sales: 60,000 tins per quarter Variable costs per dollar of sales: sales commissions 5%, delivery expense .5%, and advertising 1.5%. Fixed costs per quarter: sales salaries $40,000, office rent $1,500, office utilities $1,200, and repairs expense $200. Selling price: $10 per tin What is the budgeted total selling and administrative expenses for the quarter? 3. Sales are 30% cash and 70% on credit. Credit sales are collected 10% in the month of sale, 50% in the month following sale, and 36% in the second month following sale. Sales were December $180,000; January $220,000; February $250,000; and March $300,000. What was total cash received in March?
Explanation / Answer
1)
Units
200000
Direct labour hour
1 Hour
100
2000
200000
Variable Overheads
Per Hour
Per 2000 Hours
Indirect Material
2.05
4100
Indirect Labour
1.2
2400
Plant Utilities
9.25
18500
Factiry Equipment maintenance
3.5
7000
32000
Fixed Overheads
Per Quarter
Per Annum
Factory Worker's Insurance
3000
12000
Factory Equipment Depreciation
2000
8000
Plant Rent
12000
48000
Fixed Overheads
17000
68000
Budgeted total Manufacturing Overheads
1,00,000
2)
Per Quarter
Per Annum
Sales in quantity
60000
240000
Sales In value @ 10
600000
2400000
Variable cost
Per Dollar of sale
Sales commission @ 5%
30000
120000
Delivery expenses @ 0.5%
3000
Advertising @ 1.5%
9000
42000
Fixed cost
Per Quarter
Per Annum
Sales salaries
40000
160000
Office rent
1500
6000
Office utilities
1200
4800
Repairs expenses
200
800
42900
171600
Total Seeling and administrative Expenses for the quarter
84900
3)
Dec
Jan
Feb
Mar
Sales Value
180000
220000
250000
300000
Cash sales @30%
54000
66000
75000
90000
Credit sales @ 70%
126000
154000
175000
210000
Dec credit sales @ 10%
12600
Dec credit sales @ 50%
63000
Dec credit sales @ 36%
45360
Dec credit sales @ 4%
5040
Jan credit sales @ 10%
15400
Jan credit sales @ 50%
77000
Jan credit sales @ 36%
55440
Feb credit sales @ 10%
17500
Feb credit sales @ 50%
87500
Mar Credit sales @ 10%
21000
Total cash received
258980
1)
Units
200000
Direct labour hour
1 Hour
100
2000
200000
Variable Overheads
Per Hour
Per 2000 Hours
Indirect Material
2.05
4100
Indirect Labour
1.2
2400
Plant Utilities
9.25
18500
Factiry Equipment maintenance
3.5
7000
32000
Fixed Overheads
Per Quarter
Per Annum
Factory Worker's Insurance
3000
12000
Factory Equipment Depreciation
2000
8000
Plant Rent
12000
48000
Fixed Overheads
17000
68000
Budgeted total Manufacturing Overheads
1,00,000
2)
Per Quarter
Per Annum
Sales in quantity
60000
240000
Sales In value @ 10
600000
2400000
Variable cost
Per Dollar of sale
Sales commission @ 5%
30000
120000
Delivery expenses @ 0.5%
3000
Advertising @ 1.5%
9000
42000
Fixed cost
Per Quarter
Per Annum
Sales salaries
40000
160000
Office rent
1500
6000
Office utilities
1200
4800
Repairs expenses
200
800
42900
171600
Total Seeling and administrative Expenses for the quarter
84900
3)
Dec
Jan
Feb
Mar
Sales Value
180000
220000
250000
300000
Cash sales @30%
54000
66000
75000
90000
Credit sales @ 70%
126000
154000
175000
210000
Dec credit sales @ 10%
12600
Dec credit sales @ 50%
63000
Dec credit sales @ 36%
45360
Dec credit sales @ 4%
5040
Jan credit sales @ 10%
15400
Jan credit sales @ 50%
77000
Jan credit sales @ 36%
55440
Feb credit sales @ 10%
17500
Feb credit sales @ 50%
87500
Mar Credit sales @ 10%
21000
Total cash received
258980
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