Question

• The company is manufacturing and selling TWO models of the branded Laptops:o Model 1

  o Model 2

• Expected number of units to be sold in 2021

  o Model 1: 30,000 unitso Model 2: 20,000 units

• Expected selling Price:
  o Model 1: $500 per unit

  o Model 2: $400 per unit

• Each model requires 5 components to be finished/produced

  o Camera (Model 1 has 4 Cameras, while Model 2 has only 2 Cameras).o Keypad
  o Screen
  o Frame

  o Motherboard.

• Component purchasing prices are as follows:

  o Camera: $30o Keypads: $20o Screen: $40o Frame: $6

  o Motherboard: $24

• No ending inventory of any component item (Direct Materials) or finished goods is

  required.

• each Laptop model requires 5.5 hours of labor at a cost of $10.00 per hour to be manufactured.

• Manufacturing Overhead is allocated at a rate of $30 per Direct Labor Hour.

• Selling and Admin variable expense rates per unit of sales are sales commissions $3 and freight-out $2

• Selling and Admin fixed expenses include Depreciation $8,000 Salaries $2,000 and maintenance $3000 for each model

• Interest is $10,000 and Taxes are $50,000Required:

•

Prepare the following for 2021:
o Sales Budget
o Components (Direct Material Purchases) Budgeto Direct Labor Budget
o An overhead Budget
o Selling and Administrative Budget

Prepare a budgeted income statement

•