Homer, Inc. manufactures model airplane kits. Direct materials are two ounces of plastic per kit and the plastic costs $5 per Ounce. Indirect materials are considered insignificant and are not included in the budgeting process. Each kit requires 0.25 hours of direct labor at an average cost of $50 per hour. Manufacturing overhead is allocated using direct labor hours as the allocation base. The company has prepared the following budgets: (Click the icon to view the budgets.) Homer projects sales of 200, 300, 500, and 650 kits for the next four quarters. Homer has no kits in beginning inventory. Determine the cost per kit to manufacture the model airplane kits. Prepare a cost of goods sold budget for the year. Round amounts to two decimal places. Determine the cost per kit to manufacture the model airplane kits. (Round your answers to two decimal places, $X.XX.) Total projected manufacturing cost per kit Third Fourth Quarter Quarter Total 200 2 450 2 1,600 2 Homer, Inc. Direct Materials Budget For the Year Ended December 31 First Second Quarter Quarter Budgeted kits to be produced 500 450 Direct materials (ounces) per kit 2 2 Direct materials needed for production 1,000 900 Plus: Desired direct materials in ending inventory 90 40 Total direct materials needed 1,090 940 950 90 Less: Direct materials in beginning inventory 140 850 Budgeted purchases of direct materials $ 5$ 5 $ Direct materials cost per ounce 700 $ 4,250 $ Budgeted cost of direct materials purchases Homer, Inc. 400 90 900 210 3,200 210 490 1.110 90 3,410 950 40 450 5ls 1,020 5$ 2,460 5 $ $ 2,250 $ 5,100 $ 12,300 Homer, Inc. Direct Labor Budget For the Year Ended December 31 First Second Quarter Quarter Third Fourth Quarter Quarter Total 500 450 200 0.25 450 0.25 0.25 1,600 0.25 0.25 Budgeted kits to be produced Direct labor hours per unit Direct labor hours needed for production Direct labor cost per hour 125.00 400.00 112.50 50 $ 50.00 50 $ 112.50 50 $ $ 50 $ 50 $ 6,250 $ 5,625 $ 2,500S 5,625 $ 20,000 Budgeted direct labor cost Homer, Inc. Homer, Inc. Manufacturing Overhead Budget For the Year Ended December 31 First Second Third Fourth Quarter Quarter Quarter Quarter Total 200 450 500 0.90 $ 450 0.90 $ 1,600 0.99 $ 0.90$ 0.90$ Budgeted kits to be produced JOH cost per kit Budgeted VOH Budgeted FOH Budgeted manufacturing overhead costs 450.00 $ 160.00 405.00 $ 160.00 180.00 $ 160.00 405.00 160.00 1,440.00 840.00 565.00 $ 610.00 $ 340.00 $ 2,080.00 565.00 112.50 50.00 112.50 125.00 400.00 2,080.00 5.20 s Direct labor hours Budgeted manufacturing overhead costs Predetermined overhead allocation rate
