Question
BUDGETS #1 Create a sales budget. Thunder Creek Company expects sales of 18,000 units in January 2018, 24,000 units in February, 30,000 units in March,
| BUDGETS | ||||||||
| #1 Create a sales budget. | ||||||||
| Thunder Creek Company expects sales of 18,000 units in January 2018, 24,000 units in February, 30,000 units in March, 34,000 in April, and 36,000 in May. The sales price is $48 per unit. | ||||||||
| #2 Create a production budget. | ||||||||
| Thunder Creek wants to finish each month with 20% of next month's sales in units. | ||||||||
| #3 Create a Direct Materials Budget | ||||||||
| Thunder Creek Company uses 2 pounds of direct materials for each unit it produces, at a cost of $4.00 per pound. The company begins the year with 9,500 pounds of material in Raw Materials Inventory. Management desires an ending inventory of 25% of next month's materials requirements | ||||||||
| #4 Create a Direct Labor Budget | ||||||||
| Thunder Creek Company's workers require 30 minutes of labor to produce each unit of product. The labor cost is $20 per hour | ||||||||
| Budget #5: Create a Manufacturing Overhead Budget | ||||||||
| 1. Thunder Creek Company prepares its Manufacturing Overhead Budget. For each direct labor hour, the variable overhead costs are: Indirect Materials = $1.00 per DLH; Indirect Labor Cost = $1.30 per DLH; Maintenance = $1.20 per DLH | ||||||||
| 2. The Fixed Overhead Costs per month are: Salaries of $40,000, Depreciation =$20,000 and Maintenance = $10,000. | ||||||||
| 3. ROUND the predetermined overhead allocation rate to two decimal places. Manufacturing overhead is allocated using direct labor hours. | ||||||||
| Budget #6: Create a Cost of Goods Sold Budget | ||||||||
| Thunder Creek Company uses the first-in, first-out (FIFO) inventory costing method. | ||||||||
| The Beginning Finished Goods Inventory is $86,400 consisting of 3,600 units. | ||||||||
| Budget #7: Selling and Administrative Expense Budget | ||||||||
| Thunder Creek Company's variable supplies expense per month is $3.00 per unit. The fixed selling and administrative expenses per month consist of Salaries: $245,000; Advertising: $30,000; and Depreciation: $28,000 | ||||||||
| Budget #8: Budget Income from Continuing Operations (Tie it all together) | 2018 | |||||||
| Jan | Feb | Mar | Q1 Total | |||||
| Budgeted Sales Revenue | 0 | |||||||
| Budgeted Cost of Goods Sold | 0 | |||||||
| Budgeted Gross Profit | 0 | |||||||
| Budgeted Selling and Administrative Expenses | 0 | |||||||
| Budgeting Income from Continuing Operations | 0 | 0 | 0 | 0 | ||||
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Evaluating The Effectiveness On Internal Audit Departments
Authors: Dereje Ferede Asrat, Sewale Abate Ayalew
1st Edition
3659298387, 978-3659298387
