. Animal Gear Company makes two pet carriers, the Cat-allac and the Dog-eriffic. They are both made of plastic with metal doors, but the Cat-allac is smaller. Information for the two products for the month of April is given in the following tables: Input Prices Direct materials Plastic Metal Direct manufacturing labor $5 per pound $4 per pound $10 per direct manufacturing labor-hour Input Quantities per Unit of Output Cat-allac Dog-eriffic Direct materials Plastic 4 pounds 0.5 pounds 6 pounds 1 pound Metal Direct manufacturing labor-hours Machine-hours (MH) 3 hours 5 hours 11 MH 19 MH Inventory Information, Direct Materials Plastic Metal 290 pounds Beginning inventory Target ending inventory 70 pounds 410 pounds 65 pounds $217 Cost of beginning inventory $1,102 Animal Gear accounts for direct materials using a FIFO cost-flow assumption. Sales and Inventory Information, Finished Goods Dog-eriffic Cat-allac Expected sales in units 530 225 $ 310 $ 205 Selling price Target ending inventory in units Beginning inventory in units Beginning inventory in dollars 10 30 10 19 $1,000 $4,650 Animal Gear uses a FIFO cost-flow assumption for finished-goods inventory. Animal Gear uses an activity-based costing system and classifies overhead into three activity pools: Setup, Processing, and Inspection. Activity rates for these activities are $105 per setup-hour, $10 per machine-hour, and $15 per inspection-hour, respectively. Other information follows: Cost-Driver Information Cat-allac Dog-eriffic Number of units per batch Setup time per batch 25 1.50 hours 1.75 hours Inspection time per batch 0.5 hour 0.7 hour If necessary, round up to calculate number of batches. Nonmanufacturing fixed costs for March equal $32,000, half of which are salaries. Salaries are ex- pected to increase 5% in April. Other nonmanufacturing fixed costs will remain the same. The only variable nonmanufacturing cost is sales commission, equal to 1% of sales revenue.
. Animal Gear Company makes two pet carriers, the Cat-allac and the Dog-eriffic. They are both made of plastic with metal doors, but the Cat-allac is smaller. Information for the two products for the month of April is given in the following tables: Input Prices Direct materials Plastic Metal Direct manufacturing labor $5 per pound $4 per pound $10 per direct manufacturing labor-hour Input Quantities per Unit of Output Cat-allac Dog-eriffic Direct materials Plastic 4 pounds 0.5 pounds 6 pounds 1 pound Metal Direct manufacturing labor-hours Machine-hours (MH) 3 hours 5 hours 11 MH 19 MH Inventory Information, Direct Materials Plastic Metal 290 pounds Beginning inventory Target ending inventory 70 pounds 410 pounds 65 pounds $217 Cost of beginning inventory $1,102 Animal Gear accounts for direct materials using a FIFO cost-flow assumption. Sales and Inventory Information, Finished Goods Dog-eriffic Cat-allac Expected sales in units 530 225 $ 310 $ 205 Selling price Target ending inventory in units Beginning inventory in units Beginning inventory in dollars 10 30 10 19 $1,000 $4,650 Animal Gear uses a FIFO cost-flow assumption for finished-goods inventory. Animal Gear uses an activity-based costing system and classifies overhead into three activity pools: Setup, Processing, and Inspection. Activity rates for these activities are $105 per setup-hour, $10 per machine-hour, and $15 per inspection-hour, respectively. Other information follows: Cost-Driver Information Cat-allac Dog-eriffic Number of units per batch Setup time per batch 25 1.50 hours 1.75 hours Inspection time per batch 0.5 hour 0.7 hour If necessary, round up to calculate number of batches. Nonmanufacturing fixed costs for March equal $32,000, half of which are salaries. Salaries are ex- pected to increase 5% in April. Other nonmanufacturing fixed costs will remain the same. The only variable nonmanufacturing cost is sales commission, equal to 1% of sales revenue.
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter8: Budgeting
Section: Chapter Questions
Problem 4CMA: Krouse Company produces two products, forged putter heads and laminated putter heads, which are sold...
Related questions
Question
Q.How does preparing the budget help Animal Gear’s management team better manage the company?
Transcribed Image Text:. Animal Gear Company makes two pet carriers, the
Cat-allac and the Dog-eriffic. They are both made of plastic with metal doors, but the Cat-allac is smaller.
Information for the two products for the month of April is given in the following tables:
Input Prices
Direct materials
Plastic
Metal
Direct manufacturing labor
$5 per pound
$4 per pound
$10 per direct manufacturing labor-hour
Transcribed Image Text:Input Quantities per Unit of Output
Cat-allac
Dog-eriffic
Direct materials
Plastic
4 pounds
0.5 pounds
6 pounds
1 pound
Metal
Direct manufacturing labor-hours
Machine-hours (MH)
3 hours
5 hours
11 MH
19 MH
Inventory Information, Direct Materials
Plastic
Metal
290 pounds
Beginning inventory
Target ending inventory
70 pounds
410 pounds
65 pounds
$217
Cost of beginning inventory
$1,102
Animal Gear accounts for direct materials using a FIFO cost-flow assumption.
Sales and Inventory Information, Finished Goods
Dog-eriffic
Cat-allac
Expected sales in units
530
225
$ 310
$ 205
Selling price
Target ending inventory in units
Beginning inventory in units
Beginning inventory in dollars
10
30
10
19
$1,000
$4,650
Animal Gear uses a FIFO cost-flow assumption for finished-goods inventory.
Animal Gear uses an activity-based costing system and classifies overhead into three activity pools:
Setup, Processing, and Inspection. Activity rates for these activities are $105 per setup-hour, $10 per
machine-hour, and $15 per inspection-hour, respectively. Other information follows:
Cost-Driver Information
Cat-allac
Dog-eriffic
Number of units per batch
Setup time per batch
25
1.50 hours
1.75 hours
Inspection time per batch
0.5 hour
0.7 hour
If necessary, round up to calculate number of batches.
Nonmanufacturing fixed costs for March equal $32,000, half of which are salaries. Salaries are ex-
pected to increase 5% in April. Other nonmanufacturing fixed costs will remain the same. The only variable
nonmanufacturing cost is sales commission, equal to 1% of sales revenue.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 1 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
Financial And Managerial Accounting
Accounting
ISBN:
9781337902663
Author:
WARREN, Carl S.
Publisher:
Cengage Learning,
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
Financial And Managerial Accounting
Accounting
ISBN:
9781337902663
Author:
WARREN, Carl S.
Publisher:
Cengage Learning,
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Essentials of Business Analytics (MindTap Course …
Statistics
ISBN:
9781305627734
Author:
Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson
Publisher:
Cengage Learning
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning