menu
bartleby
search
close search
Hit Return to see all results
close solutoin list

Greiner Company makes and sells high-quality glare filters for microcomputer monitors. John Craven, controller, is responsible for preparing Greiner’s master budget and has assembled the following data for the coming year. The direct labor rate includes wages, all employee-related benefits, and the employer’s share of FICA. Labor saving machinery will be fully operational by March. Also, as of March 1, the company’s union contract calls for an increase in direct labor wages that is included in the direct labor rate. Greiner expects to have 5,600 glare filters in inventory on December 31 of the current year, and has a policy of carrying 35 percent of the following month's projected sales in inventory. Information on the first four months of the coming year is as follows: Required: 1. Prepare the following monthly budgets for Greiner Company for the first quarter of the coming year. Be sure to show supporting calculations. a. Production budget in units b. Direct labor budget in hours c. Direct materials cost budget d. Sales budget 2. Calculate the total budgeted contribution margin for Greiner Company by month and in total for the first quarter of the coming year. Be sure to show supporting calculations. (CMA adapted)

BuyFindarrow_forward

Cornerstones of Cost Management (C...

4th Edition
Don R. Hansen + 1 other
Publisher: Cengage Learning
ISBN: 9781305970663

Solutions

Chapter
Section
BuyFindarrow_forward

Cornerstones of Cost Management (C...

4th Edition
Don R. Hansen + 1 other
Publisher: Cengage Learning
ISBN: 9781305970663
Chapter 8, Problem 38P
Textbook Problem
479 views

Greiner Company makes and sells high-quality glare filters for microcomputer monitors. John Craven, controller, is responsible for preparing Greiner’s master budget and has assembled the following data for the coming year. The direct labor rate includes wages, all employee-related benefits, and the employer’s share of FICA. Labor saving machinery will be fully operational by March. Also, as of March 1, the company’s union contract calls for an increase in direct labor wages that is included in the direct labor rate. Greiner expects to have 5,600 glare filters in inventory on December 31 of the current year, and has a policy of carrying 35 percent of the following month's projected sales in inventory. Information on the first four months of the coming year is as follows:

Chapter 8, Problem 38P, Greiner Company makes and sells high-quality glare filters for microcomputer monitors. John Craven,

Required:

  1. 1. Prepare the following monthly budgets for Greiner Company for the first quarter of the coming year. Be sure to show supporting calculations.
    1. a. Production budget in units
    2. b. Direct labor budget in hours
    3. c. Direct materials cost budget
    4. d. Sales budget
  2. 2. Calculate the total budgeted contribution margin for Greiner Company by month and in total for the first quarter of the coming year. Be sure to show supporting calculations. (CMA adapted)

1.

To determine

Prepare the given budgets for G Company for the first quarter of the coming year:

  • Production budget in units.
  • Direct labor budget in units.
  • Direct materials cost budget
  • Sales budget.

Explanation of Solution

Production Budget:

The production budget refers to that budget which forecasts the production for the future accounting period. The budgeted production for any financial period is planned by combining the forecasted unit of sales and the finished goods inventory and deducting the beginning goods inventory.

A production budget reports about the number of units that a company must produce to meet the budgeted sales and inventory.

Prepare a production budget in units:

G Company
Production Budget
For the First Quarter
ParticularsJanuaryFebruaryMarchTotal
Unit sales36,00034,50039,000109,500
Add: Desired ending inventory12,07513,65013,51013,510
Total units required48,07548,15052,510123,010
Less: Beginning inventory (5,600)  (12,075)(13,650)(5,600)
Total units produced42,47536,07538,860117,410

Table (1)

Direct labor budget: A budget which shows the estimated amount payable to the labor in the exchange of their efforts during production cycle is known as direct labor budget.

Prepare a direct labor budget in units:

G Company
Direct Labor Budget
For the First Quarter
ParticularsJanuaryFebruaryMarchTotal
Units produced  (A)42,47536,07538,860117,410
Direct labor hours unit (B)×3.0×3.0×2.50
Direct labor hours needed (C = A × B)127,425108,22597,150332,800

Table (2)

Direct material budget:  This budget shows the expected requirement of raw material (in units and in dollar amount) for the budgeted period...

2.

To determine

Compute the total budgeted contribution margin for G Company by month and in total for the first quarter of the coming year.

Still sussing out bartleby?

Check out a sample textbook solution.

See a sample solution

The Solution to Your Study Problems

Bartleby provides explanations to thousands of textbook problems written by our experts, many with advanced degrees!

Get Started

Chapter 8 Solutions

Cornerstones of Cost Management (Cornerstones Series)
Show all chapter solutions
add
Ch. 8 - While many small firms do not put together a...Ch. 8 - Discuss the shortcomings of the traditional master...Ch. 8 - Define static budget. Give an example that shows...Ch. 8 - What are the two meanings of a flexible budget?...Ch. 8 - What are the steps involved in building an...Ch. 8 - FlashKick Company manufactures and sells soccer...Ch. 8 - Refer to Cornerstone Exercise 8.1, through...Ch. 8 - Refer to Cornerstone Exercise 8.2 for the...Ch. 8 - The School of Accounting (SOA) at State University...Ch. 8 - Johnston Company cleans and applies powder coat...Ch. 8 - Play-Disc makes Frisbee-type plastic discs. Each...Ch. 8 - Refer to Cornerstone Exercise 8.6. Required: 1....Ch. 8 - Timothy Donaghy has developed a unique formula for...Ch. 8 - Green Earth Landscaping Company provides monthly...Ch. 8 - Coral Seas Jewelry Company makes and sells costume...Ch. 8 - Shalimar Company manufactures and sells industrial...Ch. 8 - Khloe Company imports gift items from overseas and...Ch. 8 - Nashler Company has the following budgeted...Ch. 8 - Refer to Cornerstone Exercise 8.13. In March,...Ch. 8 - Palmgren Company produces consumer products. The...Ch. 8 - Berring Company produces two products: the deluxe...Ch. 8 - Crescent Company produces stuffed toy animals; one...Ch. 8 - Audio-2-Go, Inc., manufactures MP3 players. Models...Ch. 8 - Tiger Drug Store carries a variety of health and...Ch. 8 - Rosita Flores owns Rositas Mexican Restaurant in...Ch. 8 - Refer to Exercise 8.20. Rosita thinks that it may...Ch. 8 - Janet Wooster owns a retail store that sells new...Ch. 8 - Historically, Ragman Company has had no...Ch. 8 - Del Spencer is the owner and founder of Del...Ch. 8 - Refer to Exercise 8.24. Del Spencers purchases...Ch. 8 - Ingles Corporation is a manufacturer of tables...Ch. 8 - In an attempt to improve budgeting, the controller...Ch. 8 - Refer to Exercise 8.27. At the end of the year,...Ch. 8 - Olympus, Inc., manufactures three models of...Ch. 8 - Refer to Exercise 8.29. Suppose Gene determines...Ch. 8 - Trumbull Co. plans to produce 100,000 toy cars...Ch. 8 - Which of the following describes the order in...Ch. 8 - A companys controller is adjusting next years...Ch. 8 - A companys sales for the coming months are as...Ch. 8 - The budget that adjusts unit sales for beginning...Ch. 8 - Ponderosa, Inc., produces wiring harness...Ch. 8 - Bernard Creighton is the controller for Creighton...Ch. 8 - Greiner Company makes and sells high-quality glare...Ch. 8 - Friendly Freddies is an independently owned major...Ch. 8 - The controller for Muir Companys Salem plant is...Ch. 8 - Refer to Problem 8.40 for data. Required: 1. Run a...Ch. 8 - Norton Company, a manufacturer of infant furniture...

Additional Business Textbook Solutions

Find more solutions based on key concepts
Show solutions add
What does TELOS stand for? How is it helpful?

Pkg Acc Infor Systems MS VISIO CD

What is the primary purpose of a stock split?

Corporate Financial Accounting

Explain the following statement: Although the balance sheet can be thought of as a snapshot of a firms financia...

Fundamentals of Financial Management, Concise Edition (with Thomson ONE - Business School Edition, 1 term (6 months) Printed Access Card) (MindTap Course List)