Question
1. Prestwich Company has budgeted production for next year as follows: First quarter Second quarter Third quarter Fourth quarter Production in units. 60,000 80,000 90,000
1.
Prestwich Company has budgeted production for next year as follows:
First quarter Second quarter Third quarter Fourth quarter
Production in units. 60,000 80,000 90,000 70,000
Two pounds of material A are required for each unit produced. The company has a policy of maintaining a stock of material A on hand at the end of each quarter equal to 25% of the next quarter's production needs for material A. A total of 30,000 pounds of material A are on hand to start the year. Budgeted purchases of material A for the third quarter would be:
A. 170,000 pounds
B. 205,000 pounds
C. 165,000 pounds
D. 85,000 pounds
2.
A partial listing of costs incurred during December at Gagnier Corporation appears below:
Factory supplies......................................... $8,000
Administrative wages and salaries............ $105,000
Direct Materials....................................... $153,000
Sales staff salaries................................... $68,000
Factory depreciation............................... $49,000
Corporate headquarters building rent..... $34,000
Indirect labor.......................................... $32,000
Marketing............................................... $103,000
Direct labor............................................ $83,000
The total of the manufacturing overhead costs listed above for December is:
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