Four grams of musk oil are required for each bottle of Mink Caress, a popular perfume made by a company in western Siberia. Thecost of the musk oil is $2.10 per gram. Budgeted quarterly production of Mink Caress is given below for Year 2 and the first quarter ofYear 3:Units of raw materials needed per unit of finished goodsUnits of raw materials needed to meet productionFirst98,000Total units of raw materials neededYear 2Units of raw materials to be purchasedUnit cost of raw materialsCost of raw materials to purchasedSecond128,000Required:Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2.Budgeted production, in bottlesThe inventory of musk oil at the end of a quarter must equal 20% of the following quarter's production needs. A total of 78,400 gramsof musk oil will be on hand to start the first quarter of Year 2.Third188,000Mink CaressDirect Materials Budget - Year 2FirstFourth138,000SecondQuarterYear 3First108,000ThirdFourthYear

Lets understand the basics.Budget is an estimation of future profit and loss in current period.The…

Four grams of musk oil are required for each bottle of Mink Caress, a popular perfume made by a company in western Siberia. The Cost of the musk oil is $2.10 per gram. Budgeted quarterly production of Mink Caress is given below for Year 2 and the first quarter of Year 3: First 98,000 Year 2 Second 128,000 Third 188,000 Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Budgeted production, in bottles The inventory of musk oil at the end of a quarter must equal 20% of the following quarter's production needs. A total of 78,400 grams of musk oil will be on hand to start the first quarter of Year 2. Fourth 138,000 Mink Caress Direct Materials Budget - Year 2 Year 3 First 108,000 Quarter

Four grams of musk oil are required for each bottle of Mink Caress, a popular perfume made by a company in western Siberia. The Cost of the musk oil is $2.10 per gram. Budgeted quarterly production of Mink Caress is given below for Year 2 and the first quarter of Year 3: First 98,000 Year 2 Second 128,000 Third 188,000 Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Budgeted production, in bottles The inventory of musk oil at the end of a quarter must equal 20% of the following quarter's production needs. A total of 78,400 grams of musk oil will be on hand to start the first quarter of Year 2. Fourth 138,000 Mink Caress Direct Materials Budget - Year 2 Year 3 First 108,000 Quarter

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter8: Budgeting For Planning And Control

Section: Chapter Questions

Problem 11CE: Shalimar Company manufactures and sells industrial products. For next year, Shalimar has budgeted...

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Shalimar Company manufactures and sells industrial products. For next year, Shalimar has budgeted the follow sales: In Shalimars experience, 10 percent of sales are paid in cash. Of the sales on account, 65 percent are collected in the quarter of sale, 25 percent are collected in the quarter following the sale, and 7 percent are collected in the second quarter after the sale. The remaining 3 percent are never collected. Total sales for the third quarter of the current year are 4,900,000 and for the fourth quarter of the current year are 6,850,000. Required: 1. Calculate cash sales and credit sales expected in the last two quarters of the current year, and in each quarter of next year. 2. Construct a cash receipts budget for Shalimar Company for each quarter of the next year, showing the cash sales and the cash collections from credit sales. 3. What if the recession led Shalimars top management to assume that in the next year 10 percent of credit sales would never be collected? The expected payment percentages in the quarter of sale and the quarter after sale are assumed to be the same. How would that affect cash received in each quarter? Construct a revised cash budget using the new assumption.
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Three grams of musk oil are required for each bottle of Mink Caress, a popular perfume made by a company in western Siberia. The cost of the musk oil is $2.10 per gram. Budgeted quarterly production of Mink Caress is given below for Year 2 and the first quarter of Year 3: First 70,000 Required production in units of finished goods Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production Add: Desired units of ending raw materials inventory Total units of raw materials needed Less: Units of beginning raw materials inventory Units of raw materials to be purchased Unit cost of raw materials Cost of raw materials to purchased Second 100,000 Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Year 2 Budgeted production, in bottles The inventory of musk oil at the end of a quarter must equal 20% of the following quarter's production needs. A total of 42,000 grams of musk oil will be on hand to start…
Two grams of musk oil are required for each bottle of Mink Caress, a popular perfume made by a company in western Siberia. The cost of the musk oil is $1.60 per gram. Budgeted quarterly production of Mink Caress is given below for Year 2 and the first quarter of Year 3: Budgeted production, in bottles First 76,000 Year 2 Units of raw materials to be purchased Unit cost of raw materials Cost of raw materials to purchased Second Third Fourth 106,000 166,000 116,000 The inventory of musk oil at the end of a quarter must equal 20% of the following quarter's production needs. A total of 30,400 grams of musk oil will be on hand to start the first quarter of Year 2. Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production Total units of raw materials needed Mink Caress Direct Materials Budget - Year 2 Second First Quarter Year 3 First 86,000 Third…
Two grams of musk oil are required for each bottle of Mink Caress, a popular perfume made by a company in western Siberia. The cost of the musk oil is $1.70 per gram. Budgeted quarterly production of Mink Caress is given below for Year 2 and the first quarter of Year 3: Year 2 Year 3 First Second Third Fourth First Budgeted production, in bottles 78,000 108,000 168,000 118,000 88,000 The inventory of musk oil at the end of a quarter must equal 20% of the following quarter's production needs. A total of 31,200 grams of musk oil will be on hand to start the first quarter of Year 2. Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2.
Three grams of musk oil are required for each bottle of Mink Caress, a popular perfume made by a company in western Siberia. The cost of the musk oil is $1.90 per gram. Budgeted quarterly production of Mink Caress is given below for Year 2 and the first quarter of Year 3: Required: Prepare a direct materials budget for musk oil, by Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production First 68,000 Total units of raw materials needed Units of raw materials to be purchased Unit cost of raw materials Cost of raw materials to purchased Second 98,000 Year 2 Budgeted production, in bottles The inventory of musk oil at the end of a quarter must equal 20% of the following quarter's production needs. A total of 40,800 grams of musk oil will be on hand to start the first quarter of Year 2. Third 158,000 arter and in total, for Year 2. Mink Caress Direct Materials Budget - Year 2 First Fourth 108,000 Second Quarter Year 3 First 78,000 Third…
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