Production Cost Budget A manufacturing budget for 1999 was prepared for Sequeira Metals, of Barcelona, Spain, and is as follows Budgeted cost estimates in Spanish pesetas are based on the previous year 's actual costs Direct materials cost per unit is estimated at P600 Direct labor cost is budgeted...

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Production Cost Budget. A manufacturing budget for 1999 was prepared for Sequeira Metals, of Barcelona, Spain, and

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Production Cost Budget. A manufacturing budget for 1999 was prepared for Sequeira Metals, of Barcelona, Spain, and is as follows:

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Budgeted cost estimates in Spanish pesetas are based on the previous year's actual costs. Direct materials cost per unit is estimated at P600. Direct labor cost is budgeted at P400 per unit, and factory overhead is to be applied at 200 percent of direct labor cost. Factory overhead spending is based on a cost function of P200 per unit plus P36,000,000 per quarter. Of the quarter’s production, 75 percent is sold in the current quarter, and 25 percent is sold in the next quarter. December 31, 1998, inventory is 12,000 units.
Required:
1. Prepare a schedule showing production costs for each quarter and for 1999.
2. Compute estimated cost of goods sold for each quarter and for 1999.
3. Analyze factory overhead.

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