Question

1. Cost of goods sold budget

   Pasadena Candle Inc. A budget of estimated unit production.budgeted production of 785,000 candles for the year. Each candle requires molding. Assume that six minutes are required to mold each candle. If molding labor costs $18 per hour, determine the direct labor cost budget for the year. Wax is required to produce a candle. Assume 487,125 pounds of material will be purchased during the year. If candle wax costs $1.24 per pound, determine the direct materials purchases for the year.

   Prepare a cost of goods sold An accounting device used to plan and control resources of operational departments and divisions.budget for Pasadena Candle Inc. using the information above. Assume the estimated inventories on January 1 for finished goods and work in process were $200,000 and $41,250, respectively and direct materials wax inventory of 16,000 pounds. Also assume the desired inventories on December 31 for finished goods and work in process were $120,000 and $28,500, respectively and direct materials wax inventory of 12,500 pounds. Factory overhead was budgeted at $300,000. For those boxes in which you must enter subtracted or negative numbers use a minus sign.

   Pasadena Candle Inc.
   Cost of Goods Sold Budget
   For the Year Ending December 31
   Cost of finished goods available for sale Direct labor Factory overhead Finished goods inventory, January 1 Finished goods inventory, December 31			$
   Cost of finished goods available for sale Cost of goods manufactured Factory overhead Work in process inventory, December 31 Work in process inventory, January 1		$
   Direct materials:
   Cost of goods manufactured Direct materials inventory, January 1 Factory overhead Finished goods inventory, December 31 Total work in process during period Work in process inventory, January 1	$
   Cost of goods sold Direct labor Direct materials purchases Finished goods inventory, December 31 Work in process inventory, December 31
   Cost of direct materials available for use Cost of finished goods available for sale Cost of goods manufactured Cost of goods sold Total manufacturing costs	$
   Direct labor Direct materials inventory, December 31 Factory overhead Finished goods inventory, January 1 Total work in process during period
   Cost of direct materials placed in production	$
   Cost of goods sold Direct labor Direct materials purchases Finished goods inventory, January 1 Work in process inventory, January 1 Work in process inventory, December 31
   Cost of goods manaufactured Direct materials inventory, December 31 Direct materials inventory, January 1 Factory overhead Work in process inventory, December 31
   Cost of direct materials available for use Cost of finished goods available for sale Cost of goods manufactured Cost of goods sold Total manufacturing costs
   Total work in process during period		$
   Direct labor Direct materials inventory, December 31 Factory overhead Finished goods inventory, January 1 Work in process inventory, December 31
   Cost of direct materials available for use Cost of finished goods available for sale Cost of goods manufactured Cost of goods sold Total manufacturing costs
   Cost of direct materials available for use Cost of finished goods available for sale Cost of goods manufactured Cost of goods sold Total manufacturing costs			$
   Direct labor Direct materials inventory, December 31 Factory overhead Finished goods inventory, December 31 Work in process inventory, December 31
   Cost of direct materials available for use Cost of finished goods available for sale Cost of goods manufactured Cost of goods sold Total manufacturing costs			$

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Answer 1

Pasadena Candle Inc.

Cost of Goods Sold Budget

For the Year Ending December 31

Finished goods inventory, January 1                                                              $200000

Work in process inventory, January 1                                                             $41250

Direct materials:                     

Direct materials inventory, January 1                                                             $19840

Direct materials purchases                                                                              604035

Cost of direct materials available for use                                                        $623875

Direct materials inventory, December 31                                                       ­15500

Cost of direct materials placed in production                                                 $608375

Direct labor                                                                                                     1413000

Factory overhead                                                                                            300000

Total manufacturing costs                                                                               2321375

Total work in process during period                                                               $2362625

Work in process inventory, December 31                                                       ­28500

Cost of goods manufactured                                                                          2334125

Cost of finished goods available for sale                                                        $2534125

Finished goods inventory, December 31                                                        ­120000

Cost of goods sold                                                                                          $2414125