Accounting 202 Workbook #3

For the Month Ending February 28 Units King Prince 3. Prepare a sanich materials purchases budget for February. For those Bosus in which you must enter subtracted or negative numbers use a mus sign. Royal Furniture Company Direct Materials Purchases Budget For the Honth Ending February 28 Dinict Materials Fabric Wood Filler Springs Tutal (linear IL) (cu. [L.] [units) woundunds for production: Dared Inventory, February 28 Surfand niventory, Fulmuary 1 il units In bee puraford Unit price 4. Propane : Dred Labor canal Bulgat for Futmuary. Loyal Furniture Company Direct Labor Cost Budget Fur the Month Ending February 28 Framing Cutting Upholstery Department Department Hours recured for productions Total Hourly rateDirect materials variances Bellingham Company produces a product that requires 2.3 standard pounds per unit. The standard price is $3.50 per pound. 16,400 units used 36,600 pounds, which were purchased at $3.65 per pound. This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below. X Open spreadsheet What is the direct materials (a) price variance, (b) quantity variance, and (c) cost variance? Round your answers to the nearest dollar Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number 3. Direct materials price variance b. Direct materials quantity variance :. Direct materials cost varianceItequrrerd: 1. Determine the total variable cosrs and the ootal xed costs for the current yeac Total variable cost: 5: mm s: 2. Determine (a) the unit variable cost and {b} the unit contribution margin for the current year. Unit variable cost 3: Unit contribution margin 3: 3. Compute the break-even sales (units) For the current year. units 4. Compute the breakrerven sales (units) under the proposed program for the Following year. units 5. Determine the amount of sales (units) that would be nil-Harv under the proposed program to realize the $59,500.00!) of operating income that was earned in the current year. units 6. Determine the maximum operating income possible with the expanded plant. 4: 7. If the proposal is aocepoed and sales remain at the current level. what will the operating income or loss be for the following year? 8. Based on the data given. would you recommend accepting the proposal? a. In favor of the proposal because ofthe reduction in breakeven point. b. In favor of the proposal because ofthe possibility of increasing income from operations. c. In favor of the proposal because ofthe increase in break-even point. of. Reject the proposal because iF future sales remain at the cun'ent lei-lei, the income from operations will increase. e. Reject the proposal because lire sai necessary to maintain the current income from operations would be below lire current year sales. Choose the correct answer. ' Direct labor variances Bellingham Company produces a product that requires 3 standard direct labor hours per unit at a standard hourly rate of $20.00 per hour. 15,500 units used 66,500 hours at an hourly rate of $19.25 per hour. This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below. X Open spreadsheet What is the direct labor (a) rate variance, (b) time variance, and (c) cost variance? Round your answers to the nearest dollar Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. a. Direct labor rate variance b. Direct labor time variance c. Direct labor cost variancerec Fabric 390 sq. yds. Wood 650 linear ft. Filler 300 cu. ft. Springs 540 units Finished products: King 80 units Prince 35 units d. Direct materials used in production: In manufacture of King: Fabric 6.0 =q. yds. per unit of product Wood 38 linear ft. per unit of product Filler 4.2 cu. ft. per unit of product Springs 16 units per unit of product In manufacture of Prince: Fabric 4.0 sq. yds. per unit of product Wood 26 linear ft. per unit of product Filler 3.4 cu. ft. per unit of product Springs 12 units per unit of product e. Anticipated purchase price for direct materials: Fabric $12.00 per sq. yd. Wood 7.00 per linear ft. Filler $3.00 per cu. ft. Springs 4.50 per unitFraming Department 1.2 hrs. at $12 per hr. Cutting Department 0.5 hm. at $14 per hm. Upholstery Department 0.8 hr. at $15 per hr. Prince: Framing Department 1.0 hm. at $12 per hr. Cutting Department 0.4 hr. at $14 per hr. Upholstery Department 0.6 hm. at $15 per hr. Required: 1. Prepare a sales budget for February.Sales Budget For the Month Ending February 28 Unit Sales Unit Selling Product and Area Total Sales Volume Price King: Northern Domestic Southern Domestic International Total Prince: Northern Domestic Southern Domestic International Total Total revenue from sales 2. Prepare a production budget for February. For those boxes in which you must enter subtracted or negative numbers use a minus sign.