Is budget, including a schedule of expected cash disbursement Required Informati

Question

Is budget, including a schedule of expected cash disbursement Required Information IThe following information applies to the questions dtsplayed belowj Morgenton Company makes one product and it provided the following information to help prepare the master budget for its fnrst four months of operatuons a. The budgeted selling price per unt is $70 Budgeted unit sales for June, July, August, and September are 9,100, 22,000, 24000, and 25,000 units, respectvely. All sales are on credit Forty percent of credit sales are collected in the month of the sale and 60%n the following month. value 10.00 points b 15. What is the estimated net operating income for July, if the company always uses an estimated c. The ending finished goods Inventory equals 20% of the following months unt seies d” The ending raw materials inventory equals 10% of the following month's raw matenals predetermined plantwide overhead rate of $12 per direct labor-hour? production needs. Each unlt of finished goods requires 4 pounds of raw materals. The raw materials cost $2.50 per pound | e: Forty percent of raw materials purchases are paid for in the month of purchase and 60% f The direct labor wage rate is $12 per hour Each unit of finished goods requires two direct 9 The variable selling and acministrative expense per unit sold is $1.70. The fixed selling in the folowing month labor-hours eBook & Resources and administratve expense per month is $61,000 O Type here to search 7:38 PM /8/2018

Explanation / Answer

Unit product cost = (4*2.5+12*2+12*2) = 58 per unit

Estimated cost of goods sold = 58*22000 = 1276000

Estimated gross profit = (70-58)*22000 = 264000

Estimated selling and administrative expense = (22000*1.7+61000) = 98400

Estimated net operating income = 264000-98400 = 165600

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