BUDGET

Sales and Production Budgets 1) Minnesota Chair, Inc. Sales Budget Year Ending December 31 Quarter Year Prior year sales in units 6,000 10,000 12,000 8,000 36,000 Budget increase of 30 percent 1.30 1.30 1.30 1.30 1.30 Projected sales in units 7,800 13,000 15,600 0,400 6,800 Sales price per unit $300 $300 $300 $300 $300 Sales revenue $2,340,000 $3,900,000 $4,680,000 $3,120,000 $14,040,000 2) Minnesota Chair, Inc. Production Budget Year Ending December 31 Quarter Year Sales in units (from sales budget) 7,800 13,000 15,600 10,400 46,800 Add desired ending finished goods inventory 1,300 1,560 1.040 1,900 1,900 Total finished goods inventory needed ,100 14,560 6,640 2,300 48,700 Deduct beginning finished goods inventory 780 1300 1560 1040 780 Units to be produced 8,320 13,260 15,080 1,260 47,920 Direct Materials Purchases and Direct Labor Budgets 3) Minnesota Chair, Inc. Direct Materials Purchases Budget Year Ending December 31 Quarter Year Units to be produced (from production budget) 8,320 13,260 15,080 11,260 47,920 Materials required per unit (yards X x XXX Materials needed in production 66,560 106,08 120,640 90,080 383,360 Add desired ending inventory 15,912 18,096 13,512 14,000 14,000 Materials needed in inventory 82,472 124,17 34,152 04,080 97,360 Deduct beginning inventory 9,984 15,912 18,096 9,984 9,984 Direct materials to be purchased (yards) 72,488 108,264 116,056 94,096 387,376 Cost of materials per yard $4 S x x $4 $4 Cost of materials to be purchased $289,952 $433,056 $464,224 $376,384 $1,549,504 Direct materials cost per unit $32 Direct Materials Purchases and Direct Labor Budgets (continued) Minnesota Chair, Inc. Direct Labor Budget Year Ending December 31 Quarter 1 Year Units to be produced (from production budget) 8,320 13,260 15,080 11,260 47,920 Direct labor hours per unit 3 X x x x Total direct labor hours needed in production 24,960 39,780 45,240 33,780 143,760 Labor rate per hour $16 $16 X x $16 K X $16 $16 Total direct labor cost $399,360 $636,48 $723,840 $540,480 2,300,160 Direct labor cost per unit $48 Manufacturing Overhead Budget Minnesota Chair, Inc. Manufacturing Overhead Budget Y ear Ending December 31 Quarter 5) 3 4 Year Units to be produced (from production budget) 8,320 13,260 15,080 11,260 47,920 Variable overhead costs: Indirect materia( $ 0.20 per unit Indirect labor 1.20 per unit Other 2.70 per unit) Total variable overhead costs 7.10 59,072 S 94,146 $ 107,068 $ 79,946 $ 340,232 6) Fixed overhead costs: Salaries $100,000 $100,000 $100,000 $100,000 $100,000 $400,000 Rent $30,000 $30,000 $30,000 $30,00 $30,000 $120,000 Depreciation $44,908 $44.908 $44.908 $44.908 $44,908 $179,632 Total fixed overhead costs $174,908 $174,908 $174,908 $174,908 $699,632 Total overhead costs $233,980 $269,054 $281,976 $254,854 $1,039,864 Deduct depreciation 14,908 44,908 44.908 44,908 179.632 Cash payments for overhead $189.072 $224,146 $237.068 $209,946 $860.232 Manufacturing overhead per unit $21.70Sales and Production Budgets 1) Minnesota Chair, Inc. Sales Budget Year Ending December 31 Quarter Year Prior year sales in units 6,000 10,000 12,000 8,000 36,000 Budget increase of 30 percent 1.30 1.30 1.30 1.30 1.30 Projected sales in units 7,800 13,000 15,600 0,400 6,800 Sales price per unit $300 $300 $300 $300 $300 Sales revenue $2,340,000 $3,900,000 $4,680,000 $3,120,000 $14,040,000 2) Minnesota Chair, Inc. Production Budget Year Ending December 31 Quarter Year Sales in units (from sales budget) 7,800 13,000 15,600 10,400 46,800 Add desired ending finished goods inventory 1,300 1,560 1.040 1,900 1,900 Total finished goods inventory needed ,100 14,560 6,640 2,300 48,700 Deduct beginning finished goods inventory 780 1300 1560 1040 780 Units to be produced 8,320 13,260 15,080 1,260 47,920 Direct Materials Purchases and Direct Labor Budgets 3) Minnesota Chair, Inc. Direct Materials Purchases Budget Year Ending December 31 Quarter Year Units to be produced (from production budget) 8,320 13,260 15,080 11,260 47,920 Materials required per unit (yards X x XXX Materials needed in production 66,560 106,08 120,640 90,080 383,360 Add desired ending inventory 15,912 18,096 13,512 14,000 14,000 Materials needed in inventory 82,472 124,17 34,152 04,080 97,360 Deduct beginning inventory 9,984 15,912 18,096 9,984 9,984 Direct materials to be purchased (yards) 72,488 108,264 116,056 94,096 387,376 Cost of materials per yard $4 S x x $4 $4 Cost of materials to be purchased $289,952 $433,056 $464,224 $376,384 $1,549,504 Direct materials cost per unit $32 Direct Materials Purchases and Direct Labor Budgets (continued) Minnesota Chair, Inc. Direct Labor Budget Year Ending December 31 Quarter 1 Year Units to be produced (from production budget) 8,320 13,260 15,080 11,260 47,920 Direct labor hours per unit 3 X x x x Total direct labor hours needed in production 24,960 39,780 45,240 33,780 143,760 Labor rate per hour $16 $16 X x $16 K X $16 $16 Total direct labor cost $399,360 $636,48 $723,840 $540,480 2,300,160 Direct labor cost per unit $48 Manufacturing Overhead Budget Minnesota Chair, Inc. Manufacturing Overhead Budget Y ear Ending December 31 Quarter 5) 3 4 Year Units to be produced (from production budget) 8,320 13,260 15,080 11,260 47,920 Variable overhead costs: Indirect materia( $ 0.20 per unit Indirect labor 1.20 per unit Other 2.70 per unit) Total variable overhead costs 7.10 59,072 S 94,146 $ 107,068 $ 79,946 $ 340,232 6) Fixed overhead costs: Salaries $100,000 $100,000 $100,000 $100,000 $100,000 $400,000 Rent $30,000 $30,000 $30,000 $30,00 $30,000 $120,000 Depreciation $44,908 $44.908 $44.908 $44.908 $44,908 $179,632 Total fixed overhead costs $174,908 $174,908 $174,908 $174,908 $699,632 Total overhead costs $233,980 $269,054 $281,976 $254,854 $1,039,864 Deduct depreciation 14,908 44,908 44.908 44,908 179.632 Cash payments for overhead $189.072 $224,146 $237.068 $209,946 $860.232 Manufacturing overhead per unit $21.70