Cost of Goods Sold Budget Play-Disc makes Frisbee-type plastic discs. Each 12-inch diameter plastic disc has the following manufacturing costs: Direct materials $1.65 Direct labor 0.55 Variable overhead 0.70 Fixed overhead 1.80 $4.70 Total unit cost For the coming year, Play-Disc expects to make 300,000 plastic discs, and to sell 290,000 of them. Budgeted beginning inventory in units is 20,000 with unit cost of $4.70. (There are no beginning or ending inventories of work in process.) Required: 1. Calculate the total budgeted cost of units produced for Play-Disc for the coming year. Show the cost of direct materials, direct labor, and overhead. Budgeted direct materials Budgeted direct labor Budgeted overhead Total budgeted manufacturing cost 495,000 165,000 750,000 1,410,000 Feedback Check My Work 2. Prepare a cost of goods sold budget for Play-Disc for the year. Play-Disc Cost of Goods Sold Budget For the Year Direct materials Direct labor Overhead Total manufacturing cost Add: Beginning inventory, finished goods Less: Ending inventory, finished goods Cost of goods sold Feedback 33,000 X Check My Work To calculate ending inventory: (Beginning + Produced - Sold) x Total Unit cost. 3. What if the beginning inventory of finished goods was $93,400 (for 20,000 units)? How would that affect the cost of goods sold budget? (Assume Play-Disc uses the FIFO method.) The cost of goods sold would decrease to $ Feedback