Jackson Toys manufactures a doll to complement the \"Tickle Me Elmo\" doll calle

Question

Jackson Toys manufactures a doll to complement the "Tickle Me Elmo" doll called the "Bite Me Bertha" doll, for radical children. The company estimates that it will sell 20,000 dolls in October, 25,000 dolls in November, and 30,000 dolls in December. Beginning finished goods should be equal to 30 percent of each month's sales during these months and 10 percent of each month's sales in other months. Sales for January of next year are expected to be 15,000 dolls. The cost to produce a doll is $12.50. What will be the budgeted cost of goods manufactured for the month of December? (a) $262,500. (b) $375,000. (c) $393,750. (d) $281,250. 25.

Explanation / Answer

Budgeted cost of goods manufactured of december :

so answer is b) $375000

December Sales units 30000 Add: desired ending inventory 10500 Total needs 40500 Less: Beginning inventory (10500) Produce unit 30000 cost per unit 12.50 Cost of goods manufactured 375000

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