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Ending Finished Goods Inventory Budget Play-Disc makes Frisbee-type plastic discs. Each 12-inch diameter plastic disc has...

Ending Finished Goods Inventory Budget

Play-Disc makes Frisbee-type plastic discs. Each 12-inch diameter plastic disc has the following manufacturing costs:

Direct materials $1.65
Direct labor 0.60
Variable overhead 0.75
Fixed overhead 1.80
    Total unit cost $4.80

For the coming year, Play-Disc expects to make 320,000 plastic discs, and to sell 305,000 of them. Budgeted beginning inventory in units is 20,000 with unit cost of $4.80. (There are no beginning or ending inventories of work in process.)

Required:

1. Prepare an ending finished goods inventory budget for Play-Disc for the coming year. If required, round your answers to the nearest cent.

Play-Disc
Ending Finished Goods Inventory Budget
For the Coming Year
Unit costs:
$
Overhead:
Total cost per unit $
Total ending inventory cost $

2. What if sales increased to 332,000 discs? How would that affect the ending finished goods inventory budget? Calculate the value of budgeted ending finished goods inventory.
Finished goods inventory has to $

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Answer #1

Particulars Amount 2 Unit Costs: 3 Direct Materials 4Direct Labor S1.65 0.60 5Overhead 6 Variable Overhead S0.75 $1.80 $4.80 35000 $168,000.00 7 Fixed Overhead 8 Total Cost per unit 10 Total Ending Inve Cost 12 2 13 value of budgeted ending finished goods invento 14 Finished 8000 $38,400.00 has decreased to $38,400 Calculate above amounts as follows Amount Unit Costs: 1.65 0.6 Direct Labor Variable Overhead Fixed Overhead Total Cost per unit 0.75 20000+320000-305000 -C8 C9 Total En Cost 12 2 13 14 Finished 20000+320000-332000 -C12-C8 value of budgeted ending finished s invent tory has decreased to $38,400

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