FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Last year sales = 500,000 units. The organization is planning a 10 percent increase in sales for the year 2012. The company is a retail organization that sees higher sales due to the holidays in the 4th quarter. 40 percent of the sales occur in the 4th quarter and the remaining units are sold equally over the other three quarters.
The beginning inventory for the year amounts to 20,000 units. The estimated sales for the first quarter of 2022 amount to 115,000 units. The company requires an ending inventory of 20 percent of the next quarters' sales.
The projected sales price is $50 per unit.
Materials: Each unit requires 1 yard of fabric and 1/2 pound of fiberfill stuffing. Fabric can be purchased at $9.00 per yard and fiberfill sells for $4.00 per pound. Desired ending inventories of materials are
|
listed as follows: |
|
|
|
|
|
|
Qtr1 |
Qtr2 |
Qtr3 |
Qtr4 |
|
Fabric/yds |
17,000 |
20,000 |
18,000 |
19,000 |
|
Fiberfill/lbs |
5,000 |
6,700 |
8,000 |
8,500 |
Beginning inventory of fabric is 16,000 yards and 6,000 lbs. of fiberfill. It takes an estimated time of .25 hours to produce one unit of output. The labor cost per hour is $25 per hour and the taxes and benefit load is 25 percent.
Required:
- Prepare a quarterly sales budget in units and dollars.
- Prepare a quarterly production budget in units.
- Prepare a quarterly purchase budget for fabric and fiberfill.
- Prepare a quarterly labor budget.
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