99) Hesterman Corporation makes one product and has provided the following help prepare the master budget for the next four months of operations: 24 118 Budgeted selling price per unit Budgeted unit sales (all on credit): April May June July 7,800 9,400 14,000 12,100 Raw materials requirement per unit of output Raw materials cost 3 pounds $ 3.00 per pound 2.8 direct labor-hours $ 25.00 per direct labor-hour Direct labor requirement per unit of output Direct labor wage rate Credit sales are collected: 40% in the month of the sale 60% in the following month The ending finished goods inventory should equal 40% of the following month's sales. The ending raw materials inventory should equal 20% of the following month's raw materials production needs. The estimated direct labor cost for May is closest to: A) $786,800 B) $31,472 C) $534,000 D) $281,000

Principles of Cost Accounting
17th Edition
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Edward J. Vanderbeck, Maria R. Mitchell
Chapter7: The Master Budget And Flexible Budgeting
Section: Chapter Questions
Problem 8P: Preparing a performance report Use the flexible budget prepared in P7-6 for the 29,000-unit level of...
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99) Hesterman Corporation makes one product and has provided the following information to
help prepare the master budget for the next four months of operations:
2$
118
Budgeted selling price per unit
Budgeted unit sales (all on credit):
Аpril
May
June
7,800
9,400
14,000
12,100
July
Raw materials requirement per unit of output
Raw materials cost
Direct labor requirement per unit of output
Direct labor wage rate
3 pounds
3.00 per pound
2.8 direct labor-hours
$ 25.00 per direct labor-hour
Credit sales are collected:
40% in the month of the sale
60% in the following month
The ending finished goods inventory should equal 40% of the following month's sales. The
ending raw materials inventory should equal 20% of the following month's raw materials
production needs.
The estimated direct labor cost for May is closest to:
A) $786,800
B) $31,472
C) $534,000
D) $281,000
Transcribed Image Text:99) Hesterman Corporation makes one product and has provided the following information to help prepare the master budget for the next four months of operations: 2$ 118 Budgeted selling price per unit Budgeted unit sales (all on credit): Аpril May June 7,800 9,400 14,000 12,100 July Raw materials requirement per unit of output Raw materials cost Direct labor requirement per unit of output Direct labor wage rate 3 pounds 3.00 per pound 2.8 direct labor-hours $ 25.00 per direct labor-hour Credit sales are collected: 40% in the month of the sale 60% in the following month The ending finished goods inventory should equal 40% of the following month's sales. The ending raw materials inventory should equal 20% of the following month's raw materials production needs. The estimated direct labor cost for May is closest to: A) $786,800 B) $31,472 C) $534,000 D) $281,000
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