E8-23 (Algo) Cost of Goods Sold Budget [LO 8-3f]

Galactic Inc. manufactures flying drone toys. Sales units for January, February, March, April and May were 700, 680, 752, 712, and 780 respectively. Each unit requires 3 direct labor hours and Galactics hourly labor rate is $35 per hour. The companys variable overhead is $24 per unit produced and its fixed overhead is $7,500 per month. Use the information presented to complete the requirements. The drone toy includes 4 LED lights, which cost $15 each.

Required:

1. Determine Galactic's budgeted manufacturing cost per drone. (Note: assume that fixed overhead per unit is $27.75.)

2. Determine Galactic's budgeted cost of goods sold for January and February.