1. Projected units sales: July, 140,000; August 150,000; September 170,000; October 140,000.

2. Sales price per unit, $15.00

3. Units in ending inventory each month should equal 10% of next month sales. Beginning

inventory in units is 14,000 units.

4. Raw material required per unit is 2 pounds @ $3.00 per lb. The beginning raw material inventory is 12,600 lbs.

5. Ending inventory required at the end of each month is 5% of next month needs.

6. Direct labor required to produce one units is .25 direct labor hour. The hourly rate is $10.00. 7. Variable overhead costs for the quarter are projected to be $575,000 and fixed overhead costs are projected to be $225,000 monthly. 115,000 direct labor hours are expected to be worked in the quarter. (hint. you need to compute the variable overhead rate)

8. Sales and administrative expenses are projected to be: salaries $275, 000 per month, commissions 2% of sales dollars and other expenses are expected to be $75,000 per month plus 3% of sales dollars.

Instructions: using the parameters listed above, prepare the following budgets for the 3rd quarter: 1. Sales

2. Production

3. Raw materials, include the cost.

4. Direct labor, include the cost.

5. Manufacturing overhead

6. Sales and administrative.

VERY IMPORTANT: budgets are to be presented on an excel worksheet using the following parameters.

1. The font size is to be 11.

2. Column A (description) is to be 38 wide.

3. Columns B through E are to be 13 wide

4. Orientation is portrait

5. Fit to one page

6. Sheet to show gridlines

7. Lines are to be default width. Using the above parameters all budgets can be presented on one page using approximately 45 lines.