Product JB 50 Product JB 60 DELEON INC. Sales Budget For the Year Ending Decembe

Question

Product
JB 50

Product
JB 60

DELEON INC.
Sales Budget
For the Year Ending December 31, 2014

JB 50

JB 60

Total

Expected unit sales

Unit selling price

Total sales

Deleon Inc. is preparing its annual budgets for the year ending December 31, 2014. Accounting assistants furnish the data shown below.

Product
JB 50

Product
JB 60

Sales budget:     Anticipated volume in units 403,000 203,300     Unit selling price $22 $27 Production budget:     Desired ending finished goods units 29,000 17,600     Beginning finished goods units 32,400 13,200 Direct materials budget:     Direct materials per unit (pounds) 1 2     Desired ending direct materials pounds 33,800 16,200     Beginning direct materials pounds 43,800 13,800     Cost per pound $2 $4 Direct labor budget:     Direct labor time per unit 0.3 0.6     Direct labor rate per hour $10 $10 Budgeted income statement:     Total unit cost $13 $22
An accounting assistant has prepared the detailed manufacturing overhead budget and the selling and administrative expense budget. The latter shows selling expenses of $662,600 for product JB 50 and $361,100 for product JB 60, and administrative expenses of $541,400 for product JB 50 and $342,700 for product JB 60. Income taxes are expected to be 30%.

Explanation / Answer

DELEON INC. Production Budget For the Year Ending December 31, 2014 JB 50 JB 60 Total Expected unit sales 403000 203300 606300 Plus Desired ending finished goods units 29000 17600 46600 Total 432000 220900 652900 Less Beginning finished goods units 32400 13200 45600 Total units to be produced 399600 207700 607300

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