Computer Assignment

The Scarborough Corporation manufactures and sells two products, Thingone and Thingtwo. In July 2013, Scarboroughs Budget Department gathered the following data in order to prepare budgets for 2014:

2014 Projected Sales

Product	Units	Price
Thingone	60,000	$165
Thingtwo	40,000	$250

Expected Target Inventories

Product	January 1, 2014	December 31, 2014
Thingone	20,000	25,000
Thingtwo	8,000	9,000

The following direct materials are expected to be used in the two products:

		Material Used per Unit
Direct Material	Unit	Thingone	Thingtwo
A	pound	4	5
B	pound	2	3
C	pound	0	1

Projected data for 2014 with respect to direct materials are as follows:

Direct Material	Expected Purchase Price	Expected Inventories (January 1, 2014)	Target Inventories (December 31, 2014)
A	$12	32,000 lb	36,000 lb
B	$5	29,000 lb	32,000 lb
C	$ 3	6,000 lb	7,000 lb

Projected direct labor requirements and rates for 2014 are as follows:

Product	Hours Per Unit	Rate Per Hour
Thingone	2	$12
Thingtwo	3	$16

Manufacturing overhead is allocated at the rate of $20 per direct manufacturing labor-hour. Required: Based on the preceding projections and budget requirements for Thingone and Thingtwo, prepare the following budgets for 2014:

Revenues budget (in dollars)

Production budget (in units)

Direct materials purchases budget (in quantities)

Direct materials purchases budget (in dollars)

Direct manufacturing labor budget (in dollars)

Direct manufacturing overhead budget (in dollars)

Budgeted finished goods inventory at December 31, 2014 (in dollars)

Cost of Goods Sold budget (in dollars)