Question

Budgeted Income Statement and Supporting Budgets The budget director of Birds of a Feather Inc., with the assistance of the controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income statement for January: a. Estimated sales for January: Birdhouse 6,000 units at $55 per unit Bird feeder 4,500 units at $75 per unit b. Estimated inventories at January 1: Direct materials: Wood 220 ft. Plastic 250 lb. Finished products: Birdhouse 300 units at $23 per unit Bird feeder 240 units at $34 per unit c. Desired inventories at January 31: Direct materials: Wood 180 ft. Plastic 210 lb. Finished products:

Answer 1

Answer with working is given below

Feather Inc Factory overhead cost budget For the month ending January 31st $80,000 $25,000 $8,000 Indirect factory wages Depreciation of plant and equipment Power and light Insurance and property tax $2,000 $115,000 Total factory overhead cost budget Feather Inc 6 Cost of Goods Sold Budget For the Month ending January 31st Direct Material Opening stock Purchase of Material $2,060 $88,742 Cost of Direct material available for use $90,802 $1,692 Less: Closing stock Cost of Direct material placed in production $89,110 $85,356 $174,466 $115,000 $289,466 $29,000 $318,466 $35,400 $283,066 $15,060 $298,126 $14,620 Direct Labor PRIME COST Factory overheads Total Manufacturing cost Add: Opening stock of WIP Less: Closing stock of WIP Cost of Goods manufactured Add: Opening stock of Finished Goods Cost of finished goods available for sale Less: Closing stock of Finished Goods Cost of Goods sold $283,506 Stock of Raw Material Units Value Opening Closing Closing 180 Opening 220 250 Rate $8.00 wood $1,760 $1,440 210 $1.20 plastic Total value of stock $300 $2,060 $252 $1,692 Stock of Finished Goods Value Units Opening Closing $7,820 $6,800 $14,620 Closing 340 Opening 300 240 Bird House Bird Feeder $23.00 $6,900 200 $34.00 $8,160 $15,060 Feather Inc. 7. Selling and administrative Expenses Budget For the Month ending January 31st Selling expense Sales salaries expense Advertising expense Telephone expenses Travel expenses $90,000 $20,000 $500 $5,000 $115,500 Total Selling expense Administrative expenses Office salaries $18,000 $800 $200 $250 $450 $19,700 Depreciation expenses Telephone expenses Office supplies miscellaneous administrative expense Total administrative expense Total Operating expenses $135,200 Feather Inc. 8. Budgeted Income Statement For the Month ending January 31st $667,500 $283,506 $383,994 Sales Less: Cost of Goods Sold Gross profit Operating expenses Selling expense Administrative expense Total Selling and administrative expense $115,500 $19,700 $135,200 Operating Income $248,794 Other revenue and income Interest income $300 $249,094 Other Expense $224 $248,870 $74,661 $174,209 Less: Interest expense Income before income tax Tax at 30% Net Income