Question

Required Information SB Problem PA8-1 to PA8-3 The following Information applies to the questions displayed below] Iguana, Inc., manufactures bamboo picture frames that sell for $30 each. Each frame requires 4 linear feet of bamboo. which costs $2.50 per foot. Each frame takes approximately 30 minutes to bulld, and the labor rate averages $14 per hour Iguana has the following inventory policles Ending finished goods Inventory should be 40 percent of next month's sales. Ending direct materlals inventory should be 30 percent of next month's production Expected unit sales (frames) for the upcoming months follow 295 March April Мay 298 348 June 440 July August 415 465 Varlable manufacturing overhead is incurred at a rate of $0.20 per unit produced. Annual fixed manufacturing overhead is estimated to be $9.000 ($750 per month) for expected production of 5.0000 units for the year. Selling and administrative expenses are estimated at $800 per month plus $0.50 per unlt sold. Iguana, Inc. had $11,800 cash on hand on April 1. Of Its sales, 80 percent is In cash. Of the credit sales, 50 percent Is collected during the month of the sale, and 50 percent is collected during the month following the sale. Of direct materlals purchases, 80 percent is pald for during the month purchased and 20 percent is pald in the following month. Direct materials purchases for March 1 totaled $2,600. All other operating costs are pald during the month Incurred. Monthly fixed manufacturing overhead Includes $190 In depreclation. During April, Iguana plans to pay $3.400 for a plece of equipment

Answer 1

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April May June Budgeted Sales Revenue 2 Budgeted Production in Units Budgeted Cost of Direct Material purchases 4 Budgeted Direct Labor cost 5 Budgeted Manufacturing Overhead 6 Budgeted Cost of Goods sold 7 Total Budgeted Selling and Administration expense $8,700 310 $3,310 $2,170 $812 $5,510 $945 $10,200 380 $3,950 $2,660 $826 $6,460 $970 $13,200 430 $4,315 $3,010 $836 $8,360 $1,020 2nd Quarter Total $32,100 $1,120 $11,575 $7,840 $2,474 $20,330 $2,935 Sales Budget May April 290 Quarter 1,070 Budgeted Sales Budgeted Selling price Budgeted Sales (value) June 440 30 $13,200 30 $8,700 $10,200 $32,100 Expected Cash Collection Cash Sales Credit Sales Total Sales April 6,960 1,7401 $8,700 May 8,160 2,040 $10,200 June 10,560 2,640 $13,200 Quarter 25,680 6,420 $32,100 6,960 8,160 10,560 25,680 Cash Sales Credit Sales March Month April Month May Month June Month Total Collection from Customers 885 870 870 1,020 1,020 1,320 $12,900 885 1,740 2,040 1.320 $31,665 $8,715 $10,050 Budgeted Production Budget May April 290 136 August 465 Budgeted Sales Add: Closing inventory 340 June Quarter 440 1,070 1661 166 1,236 176 116 430 1,120 July 415 186 601 166 435 176 516 136 380 426 6061 Less: Opening Inventory Production Budget 116 310 Direct Material Purchase Budget July 1,740 Budgeted material needed for production Add: Closing inventory Total Needs Less: Opening Inventory Purchase Budget- Direct Material (Units) Purchase price Total Direct Material Purchase Budget (Value) April 1,240 456 1,6961 372 1,324) $2.50 $3,310 May 1,520 516 2,036 456 1,580 $2.50 $3,950 June 1,7201 522 2,242 516 1,726 $2.50 $4,315 Quarter 4,480 522 5,002 372 4,630 $2.50 $11,575 Expected Cash disbursements for Materials Purchases April May June 520 2,648 March Purchase April Purchase May Purchase March Purchase Total purchase payment to Vendors 662 3,160 790 3,452 $4,242 Quarter 520 3,310 3,950 3,452 $11,232 $3,168 $3,822 Budgeted Direct Labor cost April May June Quarter 1,120 0.50 Budgeted Production Budgeted Direct labor hour Total Direct labor hours Direct labor hour rate Budgeted Direct labor cost 155 190 560 $14 $2,170 $14 $2,660 $14 $3,010 $7,840 Budgeted Manufacturing Overhead April Quarter $62 $224 $560 Variable Manufacturing Overhead Fixed Manufacturing Overhead-Cash Total in Cash Depreciation Budgeted Total Manufacturing Overhead May $76 $560 $636 $190 $826 June $86 $560 $646 $190 $836 $622 $1,680 $1,904 $570 $2,474 $190 Budgeted Selling and Distribution expenses April $145 Variable Selling and administration expenses Fixed Selling and administration expenses Budgeted Selling and Distribution expenses May $170 $800 $970 June $220 $800 $1,020 Quarter $535 $2,400 $2,935 $800 $945 Budgeted Cost of Goods Sold May 340 Budgeted Sales units Budgeted manufacturing cost Budgeted Cost of Goods sold April 290 $19.00 $5,510 $19.00 $6,460 June 440 $19.00 $8,360 Quarter 1,070 $19.00 $20,330 $10.00 $7.00 Budgeted Manufacturing cost per unit Direct Material Direct Labor Variable Manufacturing overhead Fixed Manufacturing overhead Total Manufacturing cost per unit $0.20 $1.80 $19.00