[The following information applies to the questions displayed below.] Shadee Cor

Question

[The following information applies to the questions displayed below.]

Shadee Corp. expects to sell 640 sun visors in May and 380 in June. Each visor sells for $17. Shadee’s beginning and ending finished goods inventories for May are 85 and 40 units, respectively. Ending finished goods inventory for June will be 55 units.

3 Required information 2.00 points E8-7 Preparing Direct Labor Budget [LO 8-3d] Suppose that each visor takes 0.40 direct labor hours to produce and Shadee pays its workers $8 per hour. Required: Determine Shadee's budgeted direct labor cost for May and June. Do not round your intermediate values. Round your answers to 2 decimal places.) May June Budgeted Direct Labor Cost

Explanation / Answer

Solution 3:

E8-7 Preparing Direct Labour Budget

Visors produced (May)

= Sales (units) - Opening finished Inventory + Ending finished Inventory

=640 -85 +40

=595

Visors produced (June)

= Sales (units) - Opening finished Inventory* + Ending finished Inventory

=380 -40 +55

=395

* Ending finished Inventory of May will be Opening finished Inventory for June.

Particulars

May

June

Visors produced

595

395

Budgeted Direct labour hours per unit

0.40 hours

0.40 hours

Total Budgeted Direct labour hours

238 hours

158 hours

Budgeted Direct labour cost per hour

$ 8

$ 8

Total Budgeted Direct labour cost

$ 1,904

$ 1,264

Solution 2:

E 8-6 Preparing Raw Materials Purchases Budget and Manufacturing Overheads budget

= Opening Inventory -Ending Inventory

=30-17

=13

Closures Purchased (June)

= Opening Inventory* -Ending Inventory

=27 -17

=10

* Ending Inventory of May will be Opening Inventory for June.

Particulars

May

June

Closures Purchased

13

10

Cost per closure

$ 2.50

$ 2.50

Budgeted cost of Closures purchased

$ 32.50

$ 25.00

2.

Particulars

May

June

Fixed manufacturing overhead

$ 1,500

$ 1,500

Variable manufacturing overhead ($ 0.75 per unit)

(May = 595 X 0.75; June= 395 X 0.75)

$ 446.25

$ 296.25

Budgeted Manufacturing Overhead

$ 1,946.25

$ 1,796.25

Particulars

May

June

Visors produced

595

395

Budgeted Direct labour hours per unit

0.40 hours

0.40 hours

Total Budgeted Direct labour hours

238 hours

158 hours

Budgeted Direct labour cost per hour

$ 8

$ 8

Total Budgeted Direct labour cost

$ 1,904

$ 1,264

Related Questions

Navigate

• Browse (All)
• Browse #
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.