ounting Concepts and t Flows CLICK HERE TO REVIEW LEARNING OBJECTIVES QUESTION 2

Question

ounting Concepts and t Flows CLICK HERE TO REVIEW LEARNING OBJECTIVES QUESTION 22 saved Points out of 20.00 P Flag question 3: Cost tems: Job Order ting Budget Preparation Reeves Company is preparing its master budget for July. Use the given estimates to determine the amounts necessary for each of the following requirements. (Estimates may be related to more than one requirement.) a. What should total sales revenue be if territories A and B estimate sales of 8,000 and 20,000 units, respectively, and the unit selling 4: Cost Accounting tems: Process Costing price is $50? 5: Activity-Based sting b. if the beginning finished goods inventory is an estimated 1,500 units and the desired ending inventory is 2,500 units, how many units should be produced? 6: Cost-Volume-Profit lationships 7: Variable Costing: A ol for Decision Making c. What dollar amount of material should be purchased at $3 per pound if each unit of product requires 2 pounds and beginning and ending materials inventories should be 4,000 and 3,000 pounds, respectively? s 0 8: Relevant Costs and ort-Term Decision aking d. How much direct labor cost should be incurred if each unit produced requires 1.5 hours at an hourly rate of $14? 9: Planning and udgeting e. How much manufacturing overhead should be incurred if fixed manufacturing overhead is $60,000 and variable manufacturing overhead is $1.50 per direct labor hour? s o h 10: Standard Costing nd Variance Analysis

Explanation / Answer

Question - a

Total sales revenue = 28000 Units * 50 = $ 1400,000

Question - b

Production required = Estimated sales + Desired ending inventory - Available beginning Inventory

= 28000 + 2500 - 1500 = 29000 Units

Question - C

Material consumption = 2 pounds * 29000 Units = 58000 pounds

Matetial to be purchased = Material needed for production + Desired ending Inventory - Available ending Inventory

= 58000 + 3000 - 4000 = 57000 pounds

Dollar amount of material purchases = 57000 * 3 = $ 171000 ...... final answer

Question - d

Direct labor cost = 29000 * 1.5 hours * 14 per hour = 609000

Question - e

Manufacturing overhead = 60000 + 29000 * 1.5 * 1.5 = 125250

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