Chapter 10: Budgetary Planning and Control 10-13 Exercise 10- 2 The cost of direct materials for one snowboard is estimated to be $80. On January 1, 2008 the balance in raw materials inventory totaled $14,400. Alpine desires to have 20 percent of the next quarter's production needs on hand at the end of each quarter. Alpine plans to produce 1,136 snowboards in the first quarter of 2009. materials in the fourth quarter of 2008 should be $18,176. Therefore, the ending inventory in direct Prepare a quarterly direct material purchases budget for Alpine for the year 2008. a. Direct Material Purchases Budget For the Year Ending December 31, 2008 First Second Third Fourth Year Quarter Quarter Quarter Quarter 930 140 570 Units to be produced 378 $ s_3018 $ Cost of parts per unit Costs of parts needed Plus desired ending inventory Total needed Less beginning inventory Cost of purchases ilonrde are hand finished, requiring 12 hours of direct labor for each snowboard. d work 480 hours per quarter. b. The snowboards are hand finished, requiring 12 hours of direct labor for each snowboard Employees working on the snowboards average $6 per hour and work 480 hours per quarter. Prepare a quarterly direct labor budget for Alpine for 2008 Direct Labor Budget For the Year Ending December 31, 2008 First Second Third Fourth Year Quarter Quarter Quarter Quarter Direct labor hours $ Labor rate per hour Direct labor cost per unit Units to be produced $ $ Direct labor cost Total hours Hours per quarter per employee Number of employees needed