User Account

All Pages

Budget Problem, Managerial Accounting

Assignment Help:
BUDGET PROBLEM
The Budget Director of Dave, Inc. with the assistance of the Controller, Production Manager and the Sales Manager has gathered the following data for use in developing the Budgeted Income Statement for 2012. The Company produces and sells two products: Batting Helmets and Football Helmets. Both products use two types of materials: Plastic and Foam Lining and they both go through a Molding Department and then through an Assembly Department before they are ready for sale.
Assume that there is no Work-Process-Inventory.
1. Estimated Sales : 25,800 Batting Helmets at $ 40 each and 54,100 Football Helmets at $ 75 each
2. Raw materials inventories at January 1st: Plastic – 9,500 pounds and Foam lining - 4,700 pounds
3. Finished Goods inventories at January 1st:
Batting Helmets – 2,450 at $ 21 each and Football Helmets – 3,900 at $ 40 each
4. Desired raw material inventory at December 31st: Plastic – 11,400 pounds and Foam lining -
4,500 pounds
5. Desired inventory at December 31st:
Batting Helmets – 2,400 at $ 21 each and Football Helmets - 3,500 at $ 40 each
6. Direct materials used in production:
Batting Helmet – Plastic – 1.40 pounds per unit and Foam lining - .60 pounds per unit
Football Helmet – Plastic – 3.20 pounds per unit and Foam lining – 1.20 pounds per unit
7. Cost of direct materials: Plastics - $ 6.50 per pound and Foam lining - $ 3.00 per pound
8. Direct labor used in production:
Batting Helmets - .16 hour in Molding at $14 per hour and .40 hour in Assembly at $12 per hour Football Helmets - .25 hour in Molding and .60 hour in Assembly (same rates)
9. Budgeted Factory Labor Overhead:
Indirect factory wages - $ 250,000 Depreciation on plant and equipment - $ 63,000 Utilities - $ 24,000 Insurance and property taxes - $ 9,700
10. Budgeted Operating Expenses:
Sales salaries expense - $ 505,700; Advertising Expense - $ 350,800; Office Salaries Expense – $ 145,800; Depreciation Expense Office Equipment - $ 6,200; Telephone Expense Selling - $ 4,700;Telephone Expense Administrative - $ 900; Travel Expense Selling - $ 42,100; Office Supplies Expense - $ 4,000; and Miscellaneous Administrative Expenses - $ 5,000.
11. Budgeted Other income and expenses:
Interest Revenue - $ 12,500 Interest Expense - $ 15,700
12. Budgeted income tax rate – 40%
REQUIRED:
Prepare a Budgeted Income Statement for 2012 with supporting schedules. Please refer to Exhibits 8 to 15 in your text on pages 986 to 994. Project is due by May 13, 2013

Related Discussions:- Budget Problem

What is the responsibility of operating budget, What is the Responsibility ...

What is the Responsibility of operating budget when the operating budget of a firm is constructed in terms of responsibility areas it is called the responsibility budget shows

Prepare a fixed budget and a flexible budget, Question: A company has b...

Question: A company has budgeted to produce and sell 10,000 units of a product, the selling price and the variable cost per unit of which is Rs 20 and Rs 12 respectively. Fixe

Inventory control decisions, INVENTORY CONTROL DECISIONS Factories, wor...

INVENTORY CONTROL DECISIONS Factories, workshops, engineering departments handle raw materials used in the manufacture of products. The main objectives in handling these materi

Break even analysis, I need an example on how to solve a single and two pro...

I need an example on how to solve a single and two product bundle

Constructing the model, Constructing the Model Steps: 1) Identif...

Constructing the Model Steps: 1) Identify the objectives of the simulation (A detailed listing of the results expected will help to clarify the output variables. 2) R

What are the resons to use variance analysis, What are the Resons to use Va...

What are the Resons to use Variance analysis Variance analysis should be a continuous process for following reasons: 1) Labor rates, salary levels etc, changes due to union

Disadvantages of simulation, Disadvantages of Simulation 1) Although al...

Disadvantages of Simulation 1) Although all models are simplification of reality, they may still be complex and require a substantial amount of managerial and technical time.

Determine how the airline company has grown, From the subsequent financial ...

From the subsequent financial data describe: a) How the airline company has grown-up b) How the company has been capable to earn grater margins at higher levels of sales

What are the duties of the public company aob, What are the duties of the P...

What are the duties of the Public Company Accounting Oversight Board?

Explain the mark up pricing, Full cost or mark up pricing or cost plus pric...

Full cost or mark up pricing or cost plus pricing method: In this method the marketer estimates the total cost of producing or manufacturing the product and then adds it a mar

Write Your Message!

Captcha
Order Assignment

Featured Services

Order Now

Popular Subjects

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd