Question

CALCULATOR PRINTER VERSION Problem 9-2A (Part Level Submission) (Video) Deleon Inc. is preparing its annual budgets for the year ending December 31, 2020. Accounting assistants furnish the data shown below. Product JB 50 Product JB 60 202,100 401,100 $23 $27 26,100 31,800 19,800 14,200 Sales budget: Anticipated volume in units Unit selling price Production budget: Desired ending finished goods units Beginning finished goods units Direct materials budget: Direct materials per unit (pounds) Desired ending direct materials pounds Beginning direct materials pounds Cost per pound Direct labor budget: Direct labor time per unit Direct labor rate per hour Budgeted Income statement: Total unit cost 33,800 41,000 18,000 14,400 $3 0.4 0.6 $12 $12 $12 $22 An accounting assistant has prepared the detailed manufacturing overhead budget and the selling and administrative expense budget. The latter shows selling exp $662,000 for product JB 50 and $363,000 for product JB 60, and administrative expenses of $544,000 for product 8 50 and $343,000 for product B 60. Interest is $150,000 (not allocated to products). Income taxes are expected to be 30%. Your answer is correct. Prepare the sales budget for the year. • MacBook

Answer 1

Solution:

d.)

First we calculate production budget:

	Product JB 50	Product JB 60	Total
Budgeted quantity to be sold	401,100	202,100	603,200
Add: desired ending inventory	26,100	19,800	45,900
Total quantity	427,200	221,900	649,100
Less: Opening inventory balance	31,800	14,200	46,000
Budgeted quantity for production	395,400	207,700	603,100

Direct labor budget for the year

Deleon Inc.

Direct labor budgets

	Product JB 50	Product JB 60	Total
Budgeted quantity for production	395,400	207,700	603,100
Direct labor required per unit	0.4	0.6
Direct labor required for production	158,160 (395,400 × 0.4)	124,620(207,700 ×0.6)	282,780
Direct labor cost per hour	$12	$12
Budgeted direct labor cost	$1,897,920(158,160 × $12)	$1,495,440 (124,620 × $12)	$3,393,360