Budgeted Income Statement and Supporting BudgetsThe budget director of Gold Medal Athletic Co., with the assistance of the controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income statement for March:Estimated sales for March:Batting helmet1,200 units at $40 per unitFootball helmet6,500 units at $160 per unitEstimated inventories at March 1:Direct materials: Plastic90 lb. Foam lining80 lb.Finished products: Batting helmet40 units at $25 per unit Football helmet240 units at $77 per unitDesired inventories at March 31:Direct materials: Plastic50 lb. Foam lining65 lb.Finished products: Batting helmet50 units at $25 per unit Football helmet220 units at $78 per unitDirect materials used in production:In manufacture of batting helmet: Plastic1.20 lb. per unit of product Foam lining0.50 lb. per unit of productIn manufacture of football helmet: Plastic3.50 lb. per unit of product Foam lining1.50 lb. per unit of productAnticipated cost of purchases and beginning and ending inventory of direct materials:Plastic$6.00 per lb.Foam lining$4.00 per lb.Direct labor requirements:Batting helmet: Molding Department0.20 hr. at $20 per hr. Assembly Department0.50 hr. at $14 per hr.Football helmet: Molding Department0.50 hr. at $20 per hr. Assembly Department1.80 hrs. at $14 per hr.Estimated factory overhead costs for March:Indirect factory wages$86,000Depreciation of plant and equipment12,000Power and light4,000Insurance and property tax2,300Estimated operating expenses for March:Sales salaries expense$184,300Advertising expense87,200Office salaries expense32,400Depreciation expense—office equipment3,800Telephone expense—selling5,800Telephone expense—administrative1,200Travel expense—selling9,000Office supplies expense1,100Miscellaneous administrative expense1,000Estimated other income and expense for March:Interest revenue$940Interest expense872Estimated tax rate: 30%Required:1. Prepare a sales budget for March.Gold Medal Athletic Co.Sales BudgetFor the Month Ending March 31 Unit SalesVolumeUnit SellingPriceTotal SalesBatting helmetfill in the blank 1$fill in the blank 2 $fill in the blank 3 Football helmetfill in the blank 4fill in the blank 5 fill in the blank 6 Total revenue from sales $fill in the blank 7 2. Prepare a production budget for March.Gold Medal Athletic Co.Production BudgetFor the Month Ending March 31 Units Batting helmetFootball helmetExpected units to be soldfill in the blank 8fill in the blank 9Plus desired inventory, March 31fill in the blank 10fill in the blank 11 Total units requiredfill in the blank 12fill in the blank 13Less estimated inventory, March 1fill in the blank 14fill in the blank 15Total units to be producedfill in the blank 16fill in the blank 173. Prepare a direct materials purchases budget for March.Gold Medal Athletic Co.Direct Materials Purchases BudgetFor the Month Ending March 31 Plastic Foam Lining TotalPounds required for production: Batting helmetfill in the blank 18fill in the blank 19 Football helmetfill in the blank 20fill in the blank 21 Plus desired inventory, March 31fill in the blank 22fill in the blank 23 Total pounds requiredfill in the blank 24fill in the blank 25 Less estimated inventory, March 1fill in the blank 26fill in the blank 27 Total pounds to be purchasedfill in the blank 28fill in the blank 29 Unit price (per pound)$fill in the blank 30$fill in the blank 31 Total direct materials to be purchased$fill in the blank 32$fill in the blank 33$fill in the blank 344. Prepare a direct labor cost budget for March.Gold Medal Athletic Co.Direct Labor Cost BudgetFor the Month Ending March 31 MoldingDepartment AssemblyDepartment TotalHours required for production: Batting helmetfill in the blank 35fill in the blank 36 Football helmetfill in the blank 37fill in the blank 38 Total hours requiredfill in the blank 39fill in the blank 40 Hourly rate$fill in the blank 41$fill in the blank 42 Total direct labor cost$fill in the blank 43$fill in the blank 44$fill in the blank 455. Prepare a factory overhead cost budget for March.Gold Medal Athletic Co.Factory Overhead Cost BudgetFor the Month Ending March 31Indirect factory wages$fill in the blank 46Depreciation of plant and equipmentfill in the blank 47Power and lightfill in the blank 48Insurance and property taxfill in the blank 49Total$fill in the blank 50

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Financial And Managerial Accounting

15th Edition

ISBN:9781337902663

Author:WARREN, Carl S.

Publisher:WARREN, Carl S.

Chapter22: Budgeting

Section: Chapter Questions

Problem 3PB: Budgeted income statement and supporting budgets The budget director of Gold Medal Athletic Co.,...

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Budgeted Income Statement and Supporting Budgets

The budget director of Gold Medal Athletic Co., with the assistance of the controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income statement for March:

Estimated sales for March:

Batting helmet 1,200 units at $40 per unit

Football helmet 6,500 units at $160 per unit
Estimated inventories at March 1:

Direct materials:

  Plastic 90 lb.

  Foam lining 80 lb.

Finished products:

  Batting helmet 40 units at $25 per unit

  Football helmet 240 units at $77 per unit
Desired inventories at March 31:

Direct materials:

  Plastic 50 lb.

  Foam lining 65 lb.

Finished products:

  Batting helmet 50 units at $25 per unit

  Football helmet 220 units at $78 per unit

Direct materials used in production:

In manufacture of batting helmet:
Plastic	1.20 lb. per unit of product
Foam lining	0.50 lb. per unit of product
In manufacture of football helmet:
Plastic	3.50 lb. per unit of product
Foam lining	1.50 lb. per unit of product

Anticipated cost of purchases and beginning and ending inventory of direct materials:

Plastic $6.00 per lb.

Foam lining $4.00 per lb.

Direct labor requirements:

Batting helmet:
Molding Department	0.20 hr. at $20 per hr.
Assembly Department	0.50 hr. at $14 per hr.
Football helmet:
Molding Department	0.50 hr. at $20 per hr.
Assembly Department	1.80 hrs. at $14 per hr.

Estimated factory overhead costs for March:

Indirect factory wages $86,000

Depreciation of plant and equipment 12,000

Power and light 4,000

Insurance and property tax 2,300

Estimated operating expenses for March:

Sales salaries expense	$184,300
Advertising expense	87,200
Office salaries expense	32,400
Depreciation expense—office equipment	3,800
Telephone expense—selling	5,800
Telephone expense—administrative	1,200
Travel expense—selling	9,000
Office supplies expense	1,100
Miscellaneous administrative expense	1,000

Estimated other income and expense for March:

Interest revenue $940

Interest expense 872
Estimated tax rate: 30%

Required:

1. Prepare a sales budget for March.

Gold Medal Athletic Co. Sales Budget For the Month Ending March 31
	Unit Sales Volume	Unit Selling Price	Total Sales
Batting helmet	fill in the blank 1	$fill in the blank 2		$fill in the blank 3
Football helmet	fill in the blank 4	fill in the blank 5		fill in the blank 6
Total revenue from sales				$fill in the blank 7

2. Prepare a production budget for March.

Gold Medal Athletic Co. Production Budget For the Month Ending March 31
	Units
	Batting helmet	Football helmet
Expected units to be sold	fill in the blank 8	fill in the blank 9
Plus desired inventory, March 31	fill in the blank 10	fill in the blank 11
Total units required	fill in the blank 12	fill in the blank 13
Less estimated inventory, March 1	fill in the blank 14	fill in the blank 15
Total units to be produced	fill in the blank 16	fill in the blank 17

3. Prepare a direct materials purchases budget for March.

Gold Medal Athletic Co. Direct Materials Purchases Budget For the Month Ending March 31
		Plastic		Foam Lining	Total
Pounds required for production:
Batting helmet	fill in the blank 18	fill in the blank 19
Football helmet	fill in the blank 20	fill in the blank 21
Plus desired inventory, March 31	fill in the blank 22	fill in the blank 23
Total pounds required	fill in the blank 24	fill in the blank 25
Less estimated inventory, March 1	fill in the blank 26	fill in the blank 27
Total pounds to be purchased	fill in the blank 28	fill in the blank 29
Unit price (per pound)	$fill in the blank 30	$fill in the blank 31
Total direct materials to be purchased	$fill in the blank 32	$fill in the blank 33	$fill in the blank 34

4. Prepare a direct labor cost budget for March.

Gold Medal Athletic Co. Direct Labor Cost Budget For the Month Ending March 31
		Molding Department		Assembly Department	Total
Hours required for production:
Batting helmet	fill in the blank 35	fill in the blank 36
Football helmet	fill in the blank 37	fill in the blank 38
Total hours required	fill in the blank 39	fill in the blank 40
Hourly rate	$fill in the blank 41	$fill in the blank 42
Total direct labor cost	$fill in the blank 43	$fill in the blank 44	$fill in the blank 45

5. Prepare a factory overhead cost budget for March.

Gold Medal Athletic Co. Factory Overhead Cost Budget For the Month Ending March 31
Indirect factory wages	$fill in the blank 46
Depreciation of plant and equipment	fill in the blank 47
Power and light	fill in the blank 48
Insurance and property tax	fill in the blank 49
Total	$fill in the blank 50

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Batting helmet	1,200 units at $40 per unit
Football helmet	6,500 units at $160 per unit

Direct materials:
Plastic	90 lb.
Foam lining	80 lb.
Finished products:
Batting helmet	40 units at $25 per unit
Football helmet	240 units at $77 per unit

Direct materials:
Plastic	50 lb.
Foam lining	65 lb.
Finished products:
Batting helmet	50 units at $25 per unit
Football helmet	220 units at $78 per unit

Indirect factory wages	$86,000
Depreciation of plant and equipment	12,000
Power and light	4,000
Insurance and property tax	2,300

Interest revenue	$940
Interest expense	872

athered the following data for use in developing the budgeted income statement for March: Estimated sales for March: Batting helmet 1,200 units at $40 per unit Football helmet 6,500 units at $160 p