Question

Mercury Bag Company produces cases of grocery bags. The managers at Mercury are trying to develop budgets for the up quarter. The following data have been gathered. $ Projected sales in units Selling price per case Inventory at the beginning of the quarter Target inventory at the end of the quarter Direct labor hours needed to produce one case Direct labor wages Direct materials cost per case Variable manufacturing overhead cost per case Fixed overhead costs for the upcoming quarter 1,990 cases 240 150 cases 100 cases 2 hours 10 per hour A A A A $ 220,000 a. Using the above information, develop Mercury's sales forecast in dollars and production schedule in units. b. What is Mercury's budgeted variable manufacturing cost per case? c. Prepare Mercury's manufacturing cost budget. d. What is the projected ending value of the Inventory account? Answer is not complete. Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Prepare Mercury's manufacturing cost budget. (Round your cost per unit answer to 2 decimal places.) $ Variable manufacturing costs: Direct materials Direct labor Variable overhead 15,520 38,800 $ 54,320 Total variable manufacturing costs Add: Fixed manufacturing overhead Total cost of finished goods manufactured Manufacturing cost per unit $ 54,320

Can't figure out the VO FMO and MC/U

Answer 1

2 No. of cases to be manufactured = Targeted Closing Stock + Projected Sales - Opening Stock 3 No. of cases to be manufactured = 100+ 1,990 - 150 4 No. of cases to be manufactured = 1,940 cases 6 7 8 9 Variable Manufacturing Costs: Direct Materials Direct Labor Variable Overhead $ $ $ 15,520 (1,940 cases * $8 per case) 38,800 (1,940 cases * 2 hours * $10 per hour) 11,640 (1,940 cases * $6 per case) 10 11 Total Variable Manufacturing Costs 12 Add: Fixed Manufacturing Overhead 13 Total Cost of Finished goods manufactured 14 Manufacturing cost per unit $ $ $ $ 65,960 2,20,000 2,85,960 147.40 ($2,85,960/1,940 cases)