The budget director of Outdoor Chef Grill Company requests estimates of sales, production, and other operating data from the various administrative units every month. Selected information concerning sales and production for October 2008 is summarized as follows:
a. Estimated sales for October by sales territory:
|
Maine: |
|
|
Backyard Chef |
4,500 units at $800 per unit |
|
Master Chef |
1,600 units at $1,600 per unit |
|
Vermont: |
|
|
Backyard Chef |
3,800 units at $900 per unit |
|
Master Chef |
1,700 units at $1,450 per unit |
|
New Hampshire: |
|
|
Backyard Chef |
4,200 units at $850 per unit |
|
Master Chef |
1,800 units at $1,700 per unit |
b. Estimated inventories at October 1:
|
Direct materials: |
|
Finished products: |
|
|
Grates |
1,200 units |
Backyard Chef |
1,600 units |
|
Stainless steel |
2,300 lbs. |
Master Chef |
500 units |
|
Burner subassemblies |
650 units |
|
|
|
Shelves |
500 units |
|
|
c. Desired inventories at October 31:
|
Direct materials: |
|
Finished products: |
|
|
Grates |
900 units |
Backyard Chef |
1,300 units |
|
Stainless steel |
2,000 lbs. |
Master Chef |
600 units |
|
Burner subassemblies |
800 units |
|
|
|
Shelves |
450 units |
|
|
d. Direct materials used in production:
|
In manufacture of Backyard Chef: |
|
|
Grates |
3 units per unit of product |
|
Stainless steel |
25 lbs. per unit of product |
|
Burner subassemblies |
2 units per unit of product |
|
Shelves |
5 units per unit of product |
|
In manufacture of Master Chef: |
|
|
Grates |
6 units per unit of product |
|
Stainless steel |
50 lbs. per unit of product |
|
Burner subassemblies |
4 units per unit of product |
|
Shelves |
6 units per unit of product |
e. Anticipated purchase price for direct materials:
|
Grates |
$18 per unit |
Burner subassemblies |
$115 per unit |
|
Stainless steel |
$5 per lb. |
Shelves |
$6 per unit |
f. Direct labor requirements:
|
Backyard Chef: |
|
|
Stamping Department |
0.60 hour at $15 per hour |
|
Forming Department |
0.80 hour at $12 per hour |
|
Assembly Department |
1.50 hours at $9 per hour |
|
Master Chef: |
|
|
Stamping Department |
0.80 hour at $15 per hour |
|
Forming Department |
1.60 hours at $12 per hour |
|
Assembly Department |
2.50 hours at $9 per hour |
Instructions
1. Prepare a sales budget for October.
2. Prepare a production budget for October.
3. Prepare a direct materials purchases budget for October.
4. Prepare a direct labor cost budget for Oct