Question

SB Exercise E8-5 to E8-10 [The following information applies to the questions displayed below.] Shadee Corp. expects to sell 620 sun visors in May and 300 in June. Each visor sells for $20. Shadee's beginning and ending finished goods inventories for May are 80 and 45 units, respectively. Ending finished goods inventory for June will be 55 units. References Section Break SB Exercise E8-5 to E8-10 1.50 points Required information E8-5 Calculating Sales and Production Budgets (LO 8-3a, b] Required: 1. Determine Shadee's budgeted total sales for May and June May 12,400 June 6,000 Budgeted Total Sales $ $

Answer 1

solution:

Sales Budget - Shadee Corp
Particulars	May	June
Expected sales units	620	300
Selling price per unit	$20.00	$20.00
Budgeted Total Sales	$12,400.00	$6,000.00

Production Budget - Shadee Corp
Particulars	May	June
Expected sales units	620	300
Add: ending inventory	45	55
Less: Beginning inventory	80	45
Estimated production units of visor	585	310

Budgeted Purchase of cost of closures - Shadee Corp
Particulars	May	June
Budgeted Production units	585	310
Adjustable closure per unit	1	1
Estimated consumption of Adjustable Closures	585	310
Add: ending inventory	17	27
Less: Beginning inventory	34	17
Budgeted purchase units of adjustable closures	568	320
Cost per unit of closures	$2.00	$2.00
Budgeted cost of purchases	$1,136.00	$640.00

Budgeted manufacturing overhead budget - Shadee Corp
Particulars	May	June
Budgeted Production units	585	310
Variable overhead cost per unit	$1.50	$1.50
Budgeted variable overhead cost	$877.50	$465.00
Budgeted fixed overhead cost	$1,400.00	$1,400.00
Budgeted manufacturing overhead	$2,277.50	$1,865.00

Budgeted labor cost budget - Shadee Corp
Particulars	May	June
Budgeted Production units	585	310
Direct labor hours per unit	0.60	0.60
Budgeted direct labor hours	351	186
direct labor cost per hour	$11.00	$11.00
Budgeted direct labor cost	$3,861.00	$2,046.00

Computation of budgeted manufacturing cost per visor - Shadee Corp.
Particulars	Per Unit
Direct Material	$4.00
Direct labor (0.6*$11)	$6.60
Variable manufacturing overhead	$1.50
Fixed manufacturing overhead	$1.50
Budgeted manufacturing cost per unit	$13.60

Computation of budgeted cost of goods sold - Shadee Corp
Particulars	May	June
Expected sales units	620	300
Manufacturing cost per unit	$13.60	$13.60
Budgeted cost of goods sold	$8,432.00	$4,080.00

Budgeted Selling & Administrative Expenses - Shadee Corp
Particulars	May	June
Budgeted sales	$12,400.00	$6,000.00
Selling cost	$868.00	$420.00
Fixed administrative expenses	$1,100.00	$1,100.00
Budgeted selling & Administrative expenses	$1,968.00	$1,520.00