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# Question

87.Which one of the following is not needed in preparing a production budget?

a.Budgeted unit sales

b.Budgeted raw materials

c.Beginning finished goods units

d.Ending finished goods units

88.A company budgeted unit sales of 136,000 units for January, 2012 and 160,000 units for February, 2012. The company has a policy of having an inventory of units on hand at the end of each month equal to 30% of next month's budgeted unit sales. If there were 40,800 units of inventory on hand on December 31, 2011, how many units should be produced in January, 2012 in order for the company to meet its goals?

a.143,200 units

b.136,000 units

c.128,800 units

d.184,000 units

89.At January 1, 2012, Deer Corp. has beginning inventory of 2,000 surfboards. Deer estimates it will sell 5,000 units during the first quarter of 2012 with a 12% increase in sales each quarter. Deer’s policy is to maintain an ending inventory equal to 25% of the next quarter’s sales. Each surfboard costs \$100 and is sold for \$150. How much is budgeted sales revenue for the third quarter of 2012?

a.\$225,000

b.\$975,000

c.\$940,800

d.\$6,272

90.Doe Manufacturing plans to sell 4,000 purple lawn chairs during May, 3,800 in June, and 4,000 during July. The company keeps 15% of the next month’s sales as ending inventory. How many units should Doe produce during June?

a.3,830

b.4,400

c.3,770

d.Not enough information to determine.

91.Strand Company is planning to sell 200 buckets and produce 190 buckets during March. Each bucket requires 500 grams of plastic and one-half hour of direct labor. Plastic costs \$10 per 500 grams and employees of the company are paid \$15.00 per hour. Manufacturing overhead is applied at a rate of 110% of direct labor costs. Strand has 300 kilos of plastic in beginning inventory and wants to have 200 kilos in ending inventory. How much is the total amount of budgeted direct labor for March?

a.\$1,500

b.\$3,000

c.\$1,425

d.\$2,850

92.Teller Co. is planning to sell 600 boxes of ceramic tile, with production estimated at 580 boxes during May. Each box of tile requires 44 pounds of clay mix and a quarter hour of direct labor. Clay mix costs \$0.40 per pound and employees of the company are paid \$12.00 per hour. Manufacturing overhead is applied at a rate of 110% of direct labor costs. Teller has 2,600 pounds of clay mix in beginning inventory and wants to have 3,000 pounds in ending inventory.

What is the total amount to be budgeted for manufacturing overhead for the month?

a.\$1,914

b.\$1,980

c.\$7,656

d.\$7,920

93.Teller Co. is planning to sell 600 boxes of ceramic tile, with production estimated at 580 boxes during May. Each box of tile requires 44 pounds of clay mix and a quarter hour of direct labor. Clay mix costs \$0.40 per pound and employees of the company are paid \$12.00 per hour. Manufacturing overhead is applied at a rate of 110% of direct labor costs. Teller has 2,600 pounds of clay mix in beginning inventory and wants to have 3,000 pounds in ending inventory.

What is the total amount to be budgeted for direct labor for the month?

a.\$1,740

b.\$6,960

c.\$1,800

d.\$27,840

94.Teller Co. is planning to sell 600 boxes of ceramic tile, with production estimated at 580 boxes during May. Each box of tile requires 44 pounds of clay mix and a quarter hour of direct labor. Clay mix costs \$0.40 per pound and employees of the company are paid \$12.00 per hour. Manufacturing overhead is applied at a rate of 110% of direct labor costs. Teller has 2,600 pounds of clay mix in beginning inventory and wants to have 3,000 pounds in ending inventory.

What is the total amount to be budgeted in pounds for direct materials to be purchased for the month?

a.25,520

b.25,120

c.25,920

d.26,800

95.Lorie Nursery plans to sell 160 potted plants during April and 120 units in May. Lorie Nursery keeps 15% of the next month’s sales as ending inventory. How many units should Lorie Nursery produce during April?

a.154

b.166

c.160

d.178

96.Comma Co. makes and sells widgets. The company is in the process of preparing its Selling and Administrative Expense Budget for the month. The following budget data are available:

ItemVariable Cost Per Unit SoldMonthly Fixed Cost

Sales commissions\$1 \$7,500

Shipping\$3

Executive salaries\$90,000

Depreciation on office equipment\$3,000

Other\$2\$4,500

Expenses are paid in the month incurred. If the company has budgeted to sell 60,000 widgets in October, how much is the total budgeted selling and administrative expenses for October?

a.\$705,000

b.\$105,000

c.\$697,500

d.\$600,000

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