Sales, Production, Direct Materials Purchases, and Direct Labor Cost Budgets The budget director of Gourmet Grill Company requests estimates of sales, production, and other operating data from the various administrative units every month. Selected information concerning sales and production for July is summarized as follows:  Estimated sales for July by sales territory: Maine: Backyard Chef 310 units at $700 per unit Master Chef 150 units at $1,200 per unit Vermont: Backyard Chef 240 units at $750 per unit Master Chef 110 units at $1,300 per unit New Hampshire: Backyard Chef 360 units at $750 per unit Master Chef 180 units at $1,400 per unit  Estimated inventories at July 1: Direct materials: Grates 290 units Stainless steel   1,500 lbs.   Burner subassemblies 170 units Shelves 340 units Finished products: Backyard Chef 30 units Master Chef 32 units  Desired inventories at July 31: Direct materials: Grates 340 units Stainless steel   1,800 lbs.   Burner subassemblies 155 units Shelves 315 units Finished products: Backyard Chef 40 units Master Chef 22 units  Direct materials used in production: In manufacture of Backyard Chef: Grates 3 units per unit of product Stainless steel 24 lbs. per unit of product Burner subassemblies 2 units per unit of product Shelves 4 units per unit of product In manufacture of Master Chef: Grates 6 units per unit of product Stainless steel 42 lbs. per unit of product Burner subassemblies 4 units per unit of product Shelves 5 units per unit of product  Anticipated purchase price for direct materials: Grates $15 per unit Stainless steel   $6 per lb.   Burner subassemblies $110 per unit Shelves $10 per unit  Direct labor requirements: Backyard Chef: Stamping Department 0.50 hr. at $17 per hr. Forming Department 0.60 hr. at $15 per hr. Assembly Department 1.00 hr. at $14 per hr. Master Chef: Stamping Department 0.60 hr. at $17 per hr. Forming Department 0.80 hr. at $15 per hr. Assembly Department 1.50 hrs. at $14 per hr. Required: a. Prepare a sales budget for July. Gourmet Grill Company Sales Budget For the Month Ending July 31 Product and Area Unit Sales Volume Unit Selling Price Total Sales Backyard Chef:         Maine fill in the blank 1 $fill in the blank 2 $fill in the blank 3   Vermont fill in the blank 4 fill in the blank 5 fill in the blank 6   New Hampshire fill in the blank 7 fill in the blank 8 fill in the blank 9   Total fill in the blank 10   $fill in the blank 11           Master Chef:         Maine fill in the blank 12 $fill in the blank 13 $fill in the blank 14   Vermont fill in the blank 15 fill in the blank 16 fill in the blank 17   New Hampshire fill in the blank 18 fill in the blank 19 fill in the blank 20   Total fill in the blank 21   $fill in the blank 22 Total revenue from sales     $fill in the blank 23 b. Prepare a production budget for July. For those boxes in which you must enter subtracted or negative numbers use a minus sign. Gourmet Grill Company Production Budget For the Month Ending July 31   Units   Backyard Chef Master Chef Expected units to be sold  fill in the blank 25 fill in the blank 26 Desired inventory, July 31  fill in the blank 28 fill in the blank 29 Total units available  fill in the blank 31 fill in the blank 32 Estimated inventory, July 1  fill in the blank 34 fill in the blank 35 Total units to be produced  fill in the blank 37 fill in the blank 38 c. Prepare a direct materials purchases budget for July. For those boxes in which you must enter subtracted or negative numbers use a minus sign. Gourmet Grill Company Direct Materials Purchases Budget For the Month Ending July 31   Grates (units) Stainless Steel (lbs.) Burner Sub- assemblies (units) Shelves (units) Total Required units for production:           Backyard Chef fill in the blank 39 fill in the blank 40 fill in the blank 41 fill in the blank 42   Master Chef fill in the blank 43 fill in the blank 44 fill in the blank 45 fill in the blank 46   Desired inventory, July 31 fill in the blank 47 fill in the blank 48 fill in the blank 49 fill in the blank 50   Total fill in the blank 51 fill in the blank 52 fill in the blank 53 fill in the blank 54   Estimated inventory, July 1 fill in the blank 55 fill in the blank 56 fill in the blank 57 fill in the blank 58   Total units to be purchased fill in the blank 59 fill in the blank 60 fill in the blank 61 fill in the blank 62   Unit price $fill in the blank 63 $fill in the blank 64 $fill in the blank 65 $fill in the blank 66   Total direct materials to be purchased $fill in the blank 67 $fill in the blank 68 $fill in the blank 69 $fill in the blank 70 $fill in the blank 71 d. Prepare a direct labor cost budget for July. Gourmet Grill Company Direct Labor Cost Budget For the Month Ending July 31     Stamping Department   Forming Department   Assembly Department Total Hours required for production:                 Backyard Chef   fill in the blank 72   fill in the blank 73   fill in the blank 74     Master Chef   fill in the blank 75   fill in the blank 76   fill in the blank 77     Total   fill in the blank 78   fill in the blank 79   fill in the blank 80   Hourly rate   $fill in the blank    $fill in the blank    $fill in the blank    Total direct labor cost   $fill in the blank    $fill in the blank    $fill in the blank  $fill in the blank 87

Question

Sales, Production, Direct Materials Purchases, and Direct Labor Cost Budgets

The budget director of Gourmet Grill Company requests estimates of sales, production, and other operating data from the various administrative units every month. Selected information concerning sales and production for July is summarized as follows:

 Estimated sales for July by sales territory:

Maine:
Backyard Chef 310 units at $700 per unit
Master Chef 150 units at $1,200 per unit
Vermont:
Backyard Chef 240 units at $750 per unit
Master Chef 110 units at $1,300 per unit
New Hampshire:
Backyard Chef 360 units at $750 per unit
Master Chef 180 units at $1,400 per unit

 Estimated inventories at July 1:

Direct materials:
Grates 290 units
Stainless steel   1,500 lbs.  
Burner subassemblies 170 units
Shelves 340 units
Finished products:
Backyard Chef 30 units
Master Chef 32 units

 Desired inventories at July 31:

Direct materials:
Grates 340 units
Stainless steel   1,800 lbs.  
Burner subassemblies 155 units
Shelves 315 units
Finished products:
Backyard Chef 40 units
Master Chef 22 units

 Direct materials used in production:

In manufacture of Backyard Chef:
Grates 3 units per unit of product
Stainless steel 24 lbs. per unit of product
Burner subassemblies 2 units per unit of product
Shelves 4 units per unit of product
In manufacture of Master Chef:
Grates 6 units per unit of product
Stainless steel 42 lbs. per unit of product
Burner subassemblies 4 units per unit of product
Shelves 5 units per unit of product

 Anticipated purchase price for direct materials:

Grates $15 per unit
Stainless steel   $6 per lb.  
Burner subassemblies $110 per unit
Shelves $10 per unit

 Direct labor requirements:

Backyard Chef:
Stamping Department 0.50 hr. at $17 per hr.
Forming Department 0.60 hr. at $15 per hr.
Assembly Department 1.00 hr. at $14 per hr.
Master Chef:
Stamping Department 0.60 hr. at $17 per hr.
Forming Department 0.80 hr. at $15 per hr.
Assembly Department 1.50 hrs. at $14 per hr.

Required:

a. Prepare a sales budget for July.

Gourmet Grill Company
Sales Budget
For the Month Ending July 31
Product and Area Unit Sales
Volume
Unit Selling
Price
Total Sales
Backyard Chef:      
  Maine fill in the blank 1 $fill in the blank 2 $fill in the blank 3
  Vermont fill in the blank 4 fill in the blank 5 fill in the blank 6
  New Hampshire fill in the blank 7 fill in the blank 8 fill in the blank 9
  Total fill in the blank 10   $fill in the blank 11
         
Master Chef:      
  Maine fill in the blank 12 $fill in the blank 13 $fill in the blank 14
  Vermont fill in the blank 15 fill in the blank 16 fill in the blank 17
  New Hampshire fill in the blank 18 fill in the blank 19 fill in the blank 20
  Total fill in the blank 21   $fill in the blank 22
Total revenue from sales     $fill in the blank 23

b. Prepare a production budget for July. For those boxes in which you must enter subtracted or negative numbers use a minus sign.


Gourmet Grill Company
Production Budget
For the Month Ending July 31
  Units
  Backyard Chef Master Chef
Expected units to be sold  fill in the blank 25 fill in the blank 26
Desired inventory, July 31  fill in the blank 28 fill in the blank 29
Total units available  fill in the blank 31 fill in the blank 32
Estimated inventory, July 1  fill in the blank 34 fill in the blank 35
Total units to be produced  fill in the blank 37 fill in the blank 38

c. Prepare a direct materials purchases budget for July. For those boxes in which you must enter subtracted or negative numbers use a minus sign.


Gourmet Grill Company
Direct Materials Purchases Budget
For the Month Ending July 31
  Grates
(units)
Stainless Steel
(lbs.)
Burner Sub-
assemblies
(units)
Shelves
(units)
Total
Required units for production:          
Backyard Chef fill in the blank 39 fill in the blank 40 fill in the blank 41 fill in the blank 42  
Master Chef fill in the blank 43 fill in the blank 44 fill in the blank 45 fill in the blank 46  
Desired inventory, July 31 fill in the blank 47 fill in the blank 48 fill in the blank 49 fill in the blank 50  
Total fill in the blank 51 fill in the blank 52 fill in the blank 53 fill in the blank 54  
Estimated inventory, July 1 fill in the blank 55 fill in the blank 56 fill in the blank 57 fill in the blank 58  
Total units to be purchased fill in the blank 59 fill in the blank 60 fill in the blank 61 fill in the blank 62  
Unit price $fill in the blank 63 $fill in the blank 64 $fill in the blank 65 $fill in the blank 66  
Total direct materials to be purchased $fill in the blank 67 $fill in the blank 68 $fill in the blank 69 $fill in the blank 70 $fill in the blank 71

d. Prepare a direct labor cost budget for July.

Gourmet Grill Company
Direct Labor Cost Budget
For the Month Ending July 31
    Stamping
Department
  Forming Department   Assembly Department Total
Hours required for production:              
  Backyard Chef   fill in the blank 72   fill in the blank 73   fill in the blank 74  
  Master Chef   fill in the blank 75   fill in the blank 76   fill in the blank 77  
  Total   fill in the blank 78   fill in the blank 79   fill in the blank 80  
Hourly rate   $fill in the blank    $fill in the blank    $fill in the blank   
Total direct labor cost   $fill in the blank    $fill in the blank    $fill in the blank  $fill in the blank 87

 

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