Tyva makes a very popular undyed cloth sandal in one style, but in Regular and Deluxe. The Regular sandals have cloth soles and the Deluxe sandals have cloth-covered wooden soles. Tyva is preparing its budget for June 2018 and has estimated sales based on past experience. Other information for the month of June follows: Input Prices Direct materials Cloth $i25 per yard S7.50 per board foot $15 per direct manufacturing labor-hour Wood Direct manufacturing labor Input Ouantities per Unit of Output (per pair of sandals) Regular Deluxe Direct materials 1.5 yards 2 b.f. 7 hours 1.3 yards Cloth Wood Direct manufacturing labor-hours (DMLH) Setup-hours per batch 5 hours 2 hours 3 hours Inventory Information, Direct Materials Cloth Wood Beginning inventory Target ending inventory Cost of beginning inventory 800 b.f. 610 yards 386 yards $3,219 295 b.f. $6,000 Tyva accounts for direct materials using a FIFO cost-flow assumption. Sales and Inventory Information, Finished Goods Regular Deluxe Expected sales in units (pairs of sandals) Selling price Target ending inventory in units Beginning inventory in units Beginning inventory in dollars 3,000 2,000 $ 120 $ 195 400 G00 250 650 $23,250 S92,625 Tyva uses a FIFO cost-flow assumption for finished-goods inventory. All the sandals are made in batches of 50 pairs of sandals. Tyva incurs manufacturing overhead costs, marketing and general administration, and shipping costs. Besides materials and labor, manufacturing costs include setup, processing, and inspection costs. Tyva ships 40 pairs of sandals per shipment. Tyva uses activity-based costing and has classified all overhead costs for the month of June as shown in the following chart: Denominator Activity Cost Type Manufacturing Setup Processing Inspection Nonmanufacturing Marketing and general administration Shipping Rate $ 18 per setup-hour Direct manufacturing labor-hours (DMLH) $1.80 per DMLH $1.35 per pair Setup-hours Number of pairs of sandals Sales revenue Number of shipments 8% $ 15 per shipment
Tyva makes a very popular undyed cloth sandal in one style, but in Regular and Deluxe. The Regular sandals have cloth soles and the Deluxe sandals have cloth-covered wooden soles. Tyva is preparing its budget for June 2018 and has estimated sales based on past experience. Other information for the month of June follows: Input Prices Direct materials Cloth $i25 per yard S7.50 per board foot $15 per direct manufacturing labor-hour Wood Direct manufacturing labor Input Ouantities per Unit of Output (per pair of sandals) Regular Deluxe Direct materials 1.5 yards 2 b.f. 7 hours 1.3 yards Cloth Wood Direct manufacturing labor-hours (DMLH) Setup-hours per batch 5 hours 2 hours 3 hours Inventory Information, Direct Materials Cloth Wood Beginning inventory Target ending inventory Cost of beginning inventory 800 b.f. 610 yards 386 yards $3,219 295 b.f. $6,000 Tyva accounts for direct materials using a FIFO cost-flow assumption. Sales and Inventory Information, Finished Goods Regular Deluxe Expected sales in units (pairs of sandals) Selling price Target ending inventory in units Beginning inventory in units Beginning inventory in dollars 3,000 2,000 $ 120 $ 195 400 G00 250 650 $23,250 S92,625 Tyva uses a FIFO cost-flow assumption for finished-goods inventory. All the sandals are made in batches of 50 pairs of sandals. Tyva incurs manufacturing overhead costs, marketing and general administration, and shipping costs. Besides materials and labor, manufacturing costs include setup, processing, and inspection costs. Tyva ships 40 pairs of sandals per shipment. Tyva uses activity-based costing and has classified all overhead costs for the month of June as shown in the following chart: Denominator Activity Cost Type Manufacturing Setup Processing Inspection Nonmanufacturing Marketing and general administration Shipping Rate $ 18 per setup-hour Direct manufacturing labor-hours (DMLH) $1.80 per DMLH $1.35 per pair Setup-hours Number of pairs of sandals Sales revenue Number of shipments 8% $ 15 per shipment
Chapter7: Budgeting
Section: Chapter Questions
Problem 3PB: TIB makes custom guitars and prepared the following sales budget for the second quarter It also has...
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Concept explainers
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Question
Q. prepare Budgeted unit cost of ending finished-goods inventory and ending inventories budget for june.
Transcribed Image Text:Tyva
makes a very popular undyed cloth sandal in one style, but in Regular and Deluxe. The Regular sandals
have cloth soles and the Deluxe sandals have cloth-covered wooden soles. Tyva is preparing its budget for
June 2018 and has estimated sales based on past experience.
Other information for the month of June follows:
Input Prices
Direct materials
Cloth
$i25 per yard
S7.50 per board foot
$15 per direct manufacturing labor-hour
Wood
Direct manufacturing labor
Input Ouantities per Unit of Output (per pair of sandals)
Regular
Deluxe
Direct materials
1.5 yards
2 b.f.
7 hours
1.3 yards
Cloth
Wood
Direct manufacturing labor-hours (DMLH)
Setup-hours per batch
5 hours
2 hours
3 hours
Inventory Information, Direct Materials
Cloth
Wood
Beginning inventory
Target ending inventory
Cost of beginning inventory
800 b.f.
610 yards
386 yards
$3,219
295 b.f.
$6,000
Tyva accounts for direct materials using a FIFO cost-flow assumption.
Sales and Inventory Information, Finished Goods
Regular
Deluxe
Expected sales in units (pairs of sandals)
Selling price
Target ending inventory in units
Beginning inventory in units
Beginning inventory in dollars
3,000
2,000
$ 120
$ 195
400
G00
250
650
$23,250
S92,625
Tyva uses a FIFO cost-flow assumption for finished-goods inventory.
All the sandals are made in batches of 50 pairs of sandals. Tyva incurs manufacturing overhead costs,
marketing and general administration, and shipping costs. Besides materials and labor, manufacturing
costs include setup, processing, and inspection costs. Tyva ships 40 pairs of sandals per shipment. Tyva
Transcribed Image Text:uses activity-based costing and has classified all overhead costs for the month of June as shown in the
following chart:
Denominator Activity
Cost Type
Manufacturing
Setup
Processing
Inspection
Nonmanufacturing
Marketing and general administration
Shipping
Rate
$ 18 per setup-hour
Direct manufacturing labor-hours (DMLH) $1.80 per DMLH
$1.35 per pair
Setup-hours
Number of pairs of sandals
Sales revenue
Number of shipments
8%
$ 15 per shipment
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