Delray Manufacturing needs to better budget and analyze costs. While Delray has experienced high sales growth, it has struggled to effectively manage costs and inventories. Delray aims to end each month with direct materials inventory equal to 40% of next month's production needs. Each finished unit requires 4 pounds of direct materials and 2 hours of direct labor. Delray budgets $12,000 of fixed overhead costs per month. A Tableau Dashboard is provided to aid our analysis. Sales Forecast & Production Budget (in Units) 1,500 Budgeted Production Sales Forecast 1,200 1075 1125 1100 Budgeted Production 880 1025 900- O 875 900 805 Sales Forecast 600 300 0 0 April May June July Ending Direct Materials Inventory by Month March 1408 April Solve for this value May Solve for this value June Solve for this value 400 800 1200 1600 2000 Direct Materials (Pounds) Direct labor rate Direct materials cost Variable overhead rate 18/hour 25/direct labor hour / 3$/b * + ableau + * K 8 Po 1. Prepare a direct labor budget for each month of April, May, and June. 2. Prepare a factory overhead budget for each month of April, May, and June. 3. The company is considering hiring more skilled workers. These workers would increase the direct labor rate to $21 per hour and reduce direct labor hours required per finished good to 1.5 hours. Compute the direct labor budget for April assuming the company (a) does not hire more skilled workers and (b) hires more skilled workers. 4. The company is considering hiring more skilled workers. These workers would increase the direct labor rate to $21 per hour and Complete this question by entering your answers in the tabs below. Req 1 Reg 2 Req 3A and 3B Reg 4 Prepare a direct labor budget for each month of April, May, and June. (Enter your direct labor hours (hrs.) per unit in two decimal places.) DELRAY MANUFACTURING Direct Labor Budget For April, May, and June June This is a numeric cell, so please enter numbers only. 1,100 1,075 units Units to produce Materials price per pound Direct labor hours needed 4.00 4.00 hours per unit Cost of direct labor Complete this question by entering your answers in the tabs below. Req 1 Reg 2 Req 3A and 3B Req 4 Prepare a factory overhead budget for each month of April, May, and June. DELRAY MANUFACTURING Factory Overhead Budget For April, May, and June April May June Direct labor hours needed (part 1) Budgeted variable overhead Budgeted fixed overhead Budgeted total factory overhead Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req 3. Req 3A and 3B The company is considering hiring more skilled workers. These workers would increase the direct labor rate to $21 per hour and reduce direct labor hours required per finished good to 1.5 hours. Compute the direct labor budget for April assuming the company (a) does not hire more skilled workers and (b) hires more skilled workers. DELRAY MANUFACTURING Direct Labor Budget for April Does Not Hire Does Hire Units to produce 880 880 units Direct labor hours needed Cost of direct labor Complete this question by entering your answers in the tabs below. Reg 1 Req 2 Req 3A and 3B Reg 4 The company is considering hiring more skilled workers. These workers would increase the direct labor rate to $21 per hour and reduce direct labor hours required per finished good to 1.5 hours. How would this change to more skilled workers impact total budgeted factory overhead (assuming the budgeted variable overhead rate is unchanged)? How would this change to more skilled workers impact total budgeted factory overhead (assuming the budgeted variable overhead rate is unchanged)?
