Question

(The following information applies to the questions displayed below.] Iguana, Inc., manufactures bamboo picture frames that sell for $25 each. Each frame requires 4 linear feet of bamboo, which costs $2.50 per foot. Each frame takes approximately 30 minutes to build, and the labor rate averages $14 per hour. Iguana has the following inventory policies • Ending finished goods inventory should be 40 percent of next month's sales. • Ending direct materials inventory should be 30 percent of next month's production. Expected unit sales (frames) for the upcoming months follow: 315 330 380 March April May June July August 480 455 505

Answer 1

Answer with working is given below

April May June $8,250 $9,500 350 420 Budgeted Sales Revenue 2 Budgeted Production in Units Budgeted Cost of Direct Material purchases 4 Budgeted Direct Labor cost 5 Budgeted Manufacturing Overhead 6 Budgeted Cost of Goods sold 7 Total Budgeted Selling and Administration expense $3,710 $2,450 $810 $6,600 $815 $4,350 $2,940 $852 $7,600 $840 $12,000 470 $4,715 $3,290 $882| $9,600 $890 2nd Quarter Total $29,750 $1,240 $12,775 $8,680 $2,544 $23,800 $2,545 Sales Budget June 480 Budgeted Sales Budgeted Selling price Budgeted Sales (value) April 330 $25 $8,250 May 380 $25 $9,500 Quarter 1,190 $25 $29,750 $25 $12,000 Expected Cash Collection Cash Sales Credit Sales Total Sales April $6,600 $1,650 $8,250 May $7,600 $1,900 $9,500 June $9,600 $2,400 $12,000 Quarter $23,800 $5,950 $29,750 $6,600 $7,600 $9,600 $23,800 Cash Sales Credit Sales March Month April Month May Month June Month Total Collection from Customers $788 $825 $825 $950 $950 $1,200 $11,750 $788 $1,650 $1,900 $1,200 $29,338 $8,213 $9,375 Budgeted Production Budget April May August 505 330 380 Budgeted Sales Add: Closing inventory Quarter 1,190 182 1,372 152 482 1321 350 June 480 182 662 192 470 192 572 1521 420 July 455 202 657 182 475 1321 Less: Opening Inventory Production Budget 1,240 Direct Material Purchase Budget July 1,900 Budgeted material needed for production Add: Closing inventory Total Needs Less: Opening Inventory Purchase Budget- Direct Material (Units) Purchase price Total Direct Material Purchase Budget (Value) April 1,400 504 1,904 420 1,484 $2.50 $3,710 May 1,680 564 2,244 504 1,740 $2.50 $4,350 June 1,880 570 2,450 564 1,886 $2.50 $4,715 Quarter 4,960 570 5,530 420 5,110 $2.50 $12,775 Expected Cash disbursements for Materials Purchases May June April $600 $2,968 March Purchase April Purchase May Purchase March Purchase Total purchase payment to Vendors $742 $3,480 $870 $3,772 $4,642 Quarter $600 $3,710 $4,350 $3,772 $12,432 $3,568 $4,222 Budgeted Direct Labor cost April May June Quarter 1,240 350 0.50 Budgeted Production Budgeted Direct labor hour Total Direct labor hours Direct labor hour rate Budgeted Direct labor cost 235 620 175 $14 $2,450 $14 $3,290 $2,940 $8,680 Budgeted Manufacturing Overhead April June $210 $282 Variable Manufacturing Overhead Fixed Manufacturing Overhead-Cash Total in Cash Depreciation Budgeted Total Manufacturing Overhead $370 $580 $230 May May $252 $370 $622 $230 $852 $370 $652 $230 $882 Quarter $744 $1,110 $1,854 $690 $2,544 $810 Budgeted Selling and Distribution expenses April $165 Variable Selling and administration expenses Fixed Selling and administration expenses Budgeted Selling and Distribution expenses May $190 $650 $840 June $240 $650 $890 Quarter $595 $1,950 $2,545 $6509 20 $815 Budgeted Cost of Goods Sold June 480) Budgeted Sales units Budgeted manufacturing cost Budgeted Cost of Goods sold April 330 $20.00 $6,600 May 380 $20.00 $7,600 Quarter 1,190 $20.00 $23,800 $20.00 $9,600 Budgeted Manufacturing cost per unit Direct Material Direct Labor Variable Manufacturing overhead Fixed Manufacturing overhead Total Manufacturing cost per unit $10.00 $7.00 $0.60 $2.40 $20.00