Question

[The following information applies to the questions displayed below.] Shadee Corp. expects to sell 630 sun visors in May and 440 in June. Each visor sells for $15. Shadee's beginning and ending finished goods inventories for May are 75 and 40 units, respectively. Ending finished goods inventory for June will be 60 units.

Answer 1

Solution:

Working:

Computation of budgeted manufacturing cost per visor - Shadee Corp. Particulars Per Unit Direct Material $5.00 Direct labor (0.20*$10) $2.00 Variable manufacturing overhead $0.75 Fixed manufacturing overhead $1.10 9 10 11 Budgeted manufacturing cost per unit $8.85 14 15 Computation of budgeted cost of goods sold - Shadee Corp Particulars May June Expected sales units 630 440 Manufacturing cost per unit $8.85 $8.85 16 17 18 19 20 21 22 Budgeted cost of goods sold $5,575.50 $3,894.00 et737 Sheet22 (3) Sheet369 (8) Sheet740 Sheet230 (5) Sheet156 (46) Sheet743 ) Sheet744 III

Income statement:

J K L M Budgeted Income Statement - Shadee Corp Particulars May Sales revenue $9,450.00 Cost of goods sold $5,575.50 Budgeted Gross Margin $3,874.50 Selling and administrative expenses: Variable selling cost (11% of sales) $1,039.50 Fixed administrative expenses $1,500.00 Budgeted net operating income $1,335.00 June $6,600.00 $3,894.00 $2,706.00 10 11 12 13 $726.00 $1,500.00 $480.00 14 15 16 17 18 19 20 et737 Sheet22 (3) Sheet369 (8) Sheet740 Sheet230 (5) Sheet156 (46) Sheet743 ) Sheet744