**ANSWER ONLY TO 5-9***

6-33 Comprehensive problem with ABC costing. Pet Luggage Company makes two pet carriers, the Cat-allac and the Dog-eriffic. They are both made of plastic with metal doors, but the Cat-allac is smaller. Information for the two products for the month of April is given in the following tables: Input Prices Direct materials Plastic $ 4 per pound Metal $ 3 per pound Direct manufacturing labor $14 per direct manufacturing labor-hour Input Ouantities per Unit of Output Cat-allac Dog-eriffic Direct materials Plastic 3 pounds 5 pounds Metal 0.5 pounds 1 pound Direct manufacturing labor-hours (DMLH) 3 hours 5 hours Machine-hours (MH) 13 MH 20 MH Inventory Information, Direct Materials Plastic Metal Beginning inventory 230 pounds 70 pounds Target ending inventory 400 pounds 65 pounds Cost of beginning inventory $224 Pet Luggage accounts for direct materials using a FIFO cost flow assumption. Sales and Inventory Information, Finished Goods Cat-allac Dog-eriffic Expected sales in units 580 240 Selling price $ 190 $ 275 Target ending inventory in units 45 25 Beginning inventory in units 25 40 Beginning inventory in dollars $2,500 $7,440 $874 Pet Luggage uses a FIFO cost flow assumption for finished goods inventory. Pet Luggage uses an activity-based costing system and classifies overhead into three activity pools: Setup, Processing, and Inspection. Activity rates for these activities are $130 per setup-hour, $5 per machine-hour, and $20 per inspection-hour, respectively. Other information follows: Cost Driver Information Cat-allac Dog-eriffic Number of units per batch 25 13 Setup time per batch 1.25 hours 2.00 hours Inspection time per batch 0.5 hour 0.6 hour Nonmanufacturing fixed costs for March equal $32,000, of which half are salaries. Salaries are expected to increase 5% in April. The only variable nonmanufacturing cost is sales commission, equal to 1% of sales revenue. Prepare the following for April: 1. Revenues budget 2. Production budget in units 3. Direct material usage budget and direct material purchases budget 4. Direct manufacturing labor cost budget 5. Manufacturing overhead cost budgets for each of the three activities 6. Budgeted unit cost of ending finished goods inventory and ending inventories budget 7. Cost of goods sold budget 8. Nonmanufacturing costs budget 9. Budgeted income statement (ignore income taxes)