1 Bowling Ball MFG had a sales budget for bowling balls for the next months: Jan Feb Mar Apr Units 25,000 30,000 40,000 50,000 They sell each bowling ball for $70 They want ending finished goods inventory to be 20% of the next month's sales units. Beginning Finished goods inventory is 5,000 units. It takes 2 pounds of material to make each ball. That is the only Direct Material Beginning Direct Material inventory is 30,000 pounds They want ending raw material inventory to be 30% of the next month's direct material need. One pound of material cost them $2 It takes 30 minutes to make each ball and the labor cost is $18 per hour. Prepare the Sales Budget Jan Feb Mar Units Revenue 2 Prepare the Unit Production Budget in Units Jan Feb Mar 3 Prepare the Raw Materials Budget for Jan - Feb in pounds and dollars Jan Feb 4 Prepare the Labor Budget in the space below Jan Feb Mar 5 You are asked to approve or deny a request to purchase a new printer which costs 34,000 now but will increase efficiency and save $6500 cash/year for the next 6 years and can be sold after 6 years for $2,000. The discount rate is 12% Approve Deny (show why using Net Present Value) 6 In number 5, above, what would be the cash payback period. Round to one decimal point. 7 A suit making company makes and sells mens suits The standard cost for a yard of material is $3.60 Each suit requires a standard of 4 yards per suit. In one month they made 4800 suits. Actual material purchased and used was 21,120 yards at a total cost of $70,752 Prepare the Material price (rate) and usage variances 8 The suits take a standard of 1.6 labor hours to make The standard labor rate is $16 per hour. The 4800 suits they made cost $100,800 for direct labor Actual rate is $15 per hour Prepare the Labor rate and labor usage (quanity) variances 9 Below are the budget and actual income statements for 1 Qtr along with variance to budget In the space create a flexible budget for the 800 unit level and calculate variances actual versus the flexible budget. Put the number and For U for Favorable or Unfavorable Budget Actual Difference Flexible Budget Difference Units Sales 1,000 800 800 Costs/Expenses Direct Material Variab $ 3,000 $ 2,500 (500) F Direct Labor Variable 2,000 1,500 (500) F Variable OH 1,000 750 (250) F Variable Selling 1,500 1,450 (50) F Variable Admin 1,000 800 (200) F Fixed OH 2,000 2,100 100U Fixed Selling 2,500 2,500 Fixed Admin 3,000 3,000 Total Costs/Expense 16,000 14,600 (1,400) F U/F