Fillmore Company has developed the following standards related to the production of their finished units: Direct Materials (6 pounds per unit @ $7 per pound) Direct Labor (9 hours per unit @ $18 per direct labor hour) Variable Overhead (3 machine hours @ $5 per machine hour) Fixed overhead costs are estimated at $258,750 per quarter. Selling and administrative costs are expected to be $9 per unit variable and $645,000 fixed per quarter. The expected selling price is $420 per unit. The following sales forecast is available for the year 2021: 1st Quarter 9,000 units; 2nd Quarter 11,000 units; 3rd Quarter 13,000 units; and the 4th The following sales forecast is available for the year 2021: 1st Quarter 9,000 units; 2nd Quarter 11,000 units; 3rd Quarter 13,000 units; and the 4th Quarter 10,000 units. The expected sales in the 1st Quarter of the year 2022 are 9,500 units. Management policy is to maintain a finished goods inventory equal to 25% of the next quarter's sales and a raw materials inventory equal to 10% of the next quarter's material production requirements. The beginning inventories of the 1st quarter of the year 2021 are expected to meet these same requirements, 1. Prepare a production budget, by quarters for 2021. (12 pts) 2. Prepare a direct materials budget for the first TWO quarters of 2021. (12 pts) Compute the following amounts: 1. What is the budgeted annual production for the year 2021? (1 pt) units 2. What are the budgeted annual machine hours needed for production for the year 2021? (1 pt) machine hours 3. What are the budgeted annual fixed overhead costs for the year 2021? (1 pt) 4. Based on an activity measure of machine hours, what is the pre- determined fixed overhead rate for the year 2021? (2 pts) per machine hour 5. What is the total expected cost to produce one finished unit? (4 pts) per unit Compute the following amounts for the FIRST Quarter of 2021 only: (2 pts each) 1. What is total budgeted direct labor cost? 2. What is total budgeted variable overhead cost? 3. What is total budgeted fixed overhead cost? 4. What amount of fixed overhead cost will be applied to production? 5. What are total budgeted dollar sales? 6. What is total budgeted cost of goods sold? 7. What are the total budgeted selling and administrative costs? 8. What is the budgeted net income? 9. What is the budgeted ending balance (in dollars) of the raw materials inventory? 10. What is the budgeted ending balance (in dollars) of the finished goods inventory? Part D 1. What amount of fixed overhead cost will be applied to production for the year 2021? (2 pts)
