1.

Sherry and John Enterprises are using the kaizen approach to budgeting for 2018. The budgeted income statement for January 2018 is as follows:

Sales (168,000 units) $1,080,000

Less: Cost of goods sold 650,000

Gross margin 430,000

Operating expenses 330,000

(includes $60,000 of fixed costs)

Operating income $100,000

Under the kaizen approach, cost of goods sold and variable operating expenses are budgeted to decline by 1% per month.

What is budgeted cost of goods sold for March 2018?

a.

$656,500

b.

$650,000

c.

$637,065

d.

$643,500

2.

The actual information pertains to the third quarter. As part of the budgeting process, the Duck Decoy Department of Paralith Incorporated had developed the following static budget for the third quarter. Duck Decoy is in the process of preparing the flexible budget and understanding the results.

Actual Flexible Static

Results Budget Budget

Sales volume (in units) 15,000 11,000

Sales revenues $245,000 $ $235,000

Variable costs 139,000 $ ________ 184,000

Contribution margin 106,000 $ 51,000

Fixed costs 42,000 $ ________ 31,000

Operating profit $64,000 $ $20,000

The flexible budget will report ________ for variable costs.

a.

$250,909

b.

$101,933

c.

$45,000

d.

$184,000

3.

Furniture, Inc., estimates the following number of mattress sales for the first four months of 2019:

Month Sales

January 29,000

February 40,800

March 34,600

April 36,200

Finished goods inventory at the end of December is 7,000 units. Target ending finished goods inventory is 20% of the next month's sales.

How many mattresses need to be produced in January 2019?

a.

27,800 mattresses

b.

44,160 mattresses

c.

30,160 mattresses

d.

41,800 mattresses

Please i need the answers quikly