*Below is drop down menu to help you answer the following section *Below are dro
ID: 2545182 • Letter: #
Question
*Below is drop down menu to help you answer the following section
*Below are drop down menus to help you answer the above section
1 More Info Direct materials are 5 ounces of plastic per kit and the plastic costs $2 per ounce Indirect materials are considered insignificant and are not included in the budgeting process. Beginning Raw Materials Inventory is 880 ounces, and the company desires to end each quarter with 30% of the materials needed for the next quarter's production. Wilber desires a balance of 220 ounces in Raw Materials Inventory at the end of the fourth quarter. Each kit requires 0.25 hours of direct labor at an average cost of $22 per hour. Manufacturing overhead is allocated using direct labor hours as the allocation base. Variable overhead is $0.80 per kit, and fixed overhead is $140 per quarterExplanation / Answer
Direct material's budget:
First quarter
Second quarter
Third quarter
Fourth quarter
Budgeted kits to be produced
550
530
650
300
Direct material (ounces) per kit
5
5
5
5
Direct materials needed for production
2750
2650
3250
1500
Plus:Desired direct material in ending inventory
795
975
450
220
Total direct material needed
3545
3625
3700
1720
Less:Direct material in beginning inventory
880
795
975
450
Budgeted purchase of direct material
2665
2830
2725
1270
Direct materials cost per ounce
2
2
2
2
Budgeted cost of direct material purchases
5330
5660
5450
2540
Direct labor budget:
First quarter
Second quarter
Third quarter
Fourth quarter
Budgeted kits to be produced
550
530
650
300
Direct labor hours per unit
0.25
0.25
0.25
0.25
Direct labor needed for production
137.5
132.5
162.5
75
Direct labor cost per hour
22
22
22
22
Budgeted direct labor cost
3025
2915
3575
1650
Manufacturing overhead budget:
First quarter
Second quarter
Third quarter
Fourth quarter
Total
Budgeted kits to be produced
550
530
650
300
2030
VOH cost per kit
0.8
0.8
0.8
0.8
0.8
Budgeted VOH
440
424
520
240
1624
Budgeted FOH
140
140
140
140
560
Budgeted manufacturing overhead cost
580
564
660
380
2184
Direct labor hours
137.5
132.5
162.5
75
507.5
Budgeted manufacturing overhead cost
2184
Predetermined overhead allocation rate
4.30
First quarter
Second quarter
Third quarter
Fourth quarter
Budgeted kits to be produced
550
530
650
300
Direct material (ounces) per kit
5
5
5
5
Direct materials needed for production
2750
2650
3250
1500
Plus:Desired direct material in ending inventory
795
975
450
220
Total direct material needed
3545
3625
3700
1720
Less:Direct material in beginning inventory
880
795
975
450
Budgeted purchase of direct material
2665
2830
2725
1270
Direct materials cost per ounce
2
2
2
2
Budgeted cost of direct material purchases
5330
5660
5450
2540
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.