Sierra Furniture is an elite desk manufacturer. It makes two products: ¢ Executive desks-3'x 5'oak desks ¢

Question:

Sierra Furniture is an elite desk manufacturer. It makes two products:
€¢ Executive desks-3'x 5'oak desks
€¢ Chairman desks-6'x 4'red oak desks
The budgeted direct-cost inputs for each product in 2006 are:

Unit data pertaining to the direct materials for March 2006 are:
Actual Beginning Direct Material Inventory (3/1/2006)

Target Ending Direct Materials Inventory (3/31/2006)

Unit cost data for direct cost inputs pertaining to February 2006 and March 2006 are:

Manufacturing overhead (both variable and fixed) is allocated to each desk on the basis of budgeted direct manufacturing labor-hours per desk. The budgeted variable manufacturing overhead rate for March 2006 is $35 per direct manufacturing labor-hour. The budgeted fixed manufacturing overhead for March 2006 is $42,500. Both variable and fixed manufacturing overhead costs are allocated to each unit of finished goods.
Data relating to finished goods inventory for March 2006 are:

Budgeted sales for March 2006 are 740 units of the executive line and 390 units of the chairman line. The budgeted selling prices per unit in March 2006 are $1,020 for the executive-line desk and $1,600 for the chairman-line desk. Assume the following in your answer:
– Work-in-process inventories are negligible and ignored.
– Direct materials inventory and finished goods inventory are costed using the FIFO method.
– Unit costs of direct materials purchased and finished goods are constant in March 2006.
Required
1. Prepare the following budgets for March 2006:
a. Revenues budget
b. Production budget in units
c. Direct material usage budget and direct material purchases budget
d. Direct manufacturing labor budget
e. Manufacturing overhead budget
f. Ending inventory budget (direct materials and finished goods)
g. Cost of goods sold budget