Question
Bonkowski Corporation makes one product and has provided the following information to help prepare the master budget for the next four months of operations: Budgeted
Bonkowski Corporation makes one product and has provided the following information to help prepare the master budget for the next four months of operations:
Budgeted selling price per unit | $ | 97 |
Budgeted unit sales (all on credit): | ||
January | 10,000 | |
February | 12,000 | |
March | 13,300 | |
April | 15,200 |
Raw materials requirement per unit of output | 4 | pounds | |
Raw materials cost | $ | 1.00 | per pound |
Direct labor requirement per unit of output | 2.5 | direct labor-hours | |
Direct labor wage rate | $ | 23.00 | per direct labor-hour |
Predetermined overhead rate (all variable) | $ | 9.00 | per direct labor-hour |
Variable selling and administrative expense | $ | 3.10 | per unit sold |
Fixed selling and administrative expense | $ | 70,000 | per month |
Credit sales are collected: 30% in the month of the sale 70% in the following month Raw materials purchases are paid: 30% in the month of purchase 70% in the following month The ending finished goods inventory should equal 30% of the following month's sales. The ending raw materials inventory should equal 10% of the following month's raw materials production needs. The budgeted sales for February is closest to:
$1,290,100 | ||
$1,164,000 | ||
$970,000 | ||
$1,474,400 |
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