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Donnegal Company makes and sells artistic frames for pictures. The controller is responsible for preparing the master budget and has accumulated the following information for
Donnegal Company makes and sells artistic frames for pictures. The controller is responsible for preparing the master budget and has accumulated the following information for 2014.
Jan Feb March April May
Estimated unit sales | 10,800 | 11,800 | 8,400 | 8,400 | 8,600 |
Sales Price per unit | $50.8 | $47.8 | $47.8 | $47.8 | $47.8 |
Direct labor hours per unit | 2.3 | 2.3 | 1.5 | 1.5 | 1.5 |
Wage per direct labor hour | $9 | $9 | $9 | $10 | $10 |
Donnegal has a labor contract that calls for a wage increase to $10 per hour on April 1. New labor-saving machinery has been installed and will be fully operational by March 1.
Donnegal expects to begin the year with 19,060 frames on hand and has a policy of carrying an end-of-month inventory of 100% of the following month
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