Operating budget. $lopes Inc. manufactures and sells snowboards, hlopes manufactures a single model, the Pipex. In the summer of 2007, hlopes’s accountant gathered the following data to prepare budgets for 2008. These units are standard in the lumber industry. Wage rate

= $2 5/hr.

Materials and labour requirements Direct materials Wood 5 board-feet per snowboard Fibreglass Direct labour 6 yards per snowboard 5 hours per snowboard

$lopes’s CEO expects to sell 1,200 snowboards during 2008 at an estimated retail price of

$540 per board. Further, she expects 2008 beginning inventory to be 100 boards and would like to end 2008 with 200 snowboards in stock. The company follows FIFO for inventory flow.

Direct material inventories Beginning Inventory January 1,2008 Ending Inventory December 31, 2008 Wood 2,000 1,500 MASTER BUDGET AND Fibreglass 1,000 2,000 The beginning inventory ofwood was purchased at $34 per board foot and fibreglass was pur¬
chased at $5.80 per yard. Prices have now risen to $36 per board foot ofwood and $6 per yard of fibreglass. Variable manufacturing overhead is allocated at the rate of $8.40 per direct manu¬
facturing labour-hour. Fixed manufacturing overhead costs are budgeted at $78,000 for 2008.
Variable marketing costs are allocated at the rate of $300 per sales visit, and the marketing plan calls for 36 sales visits during 2008. Finally, fixed nonmanufacturing costs are budgeted at $36,000 for 2008.
Required Based on the data and projections supplied by filopes’s managers, 1. Prepare the 2008 revenue budget (in dollars).
2. Prepare the 2008 production budget (in units).
3. Prepare direct materials usage and purchases budgets for 2008.
4. Prepare a direct manufacturing labour budget for 2008.
5. Prepare a manufacturing overhead budget for 2008.
6. What is the budgeted manufacturing overhead rate?
7. What is the budgeted manufacturing overhead cost per output unit?
8. Calculate the cost of a snowboard in finished goods inventory at the end of 2008.
9. Prepare an ending inventory budget for 2008.
10. Prepare a cost-of-goods-sold budget for 2008. (Opening finished goods inventory is $44,976.)
11. Prepare the budgeted income statement for $lopes Inc. for 2008.