Instruction: Buff Company expects to meet future sales requirements by maintaing an ending inventory equal to 20% of the next quarter's budgted sales volume. Use these information to complete the production budget. 20% Ending Inventory as _ of next quarter's sales volume: Ending Finished Goods Inventory on Decemeber 31, 2021: Expected Sales Volume for Quarter 1 of year 2023: units 420 2.900 units Year Buff Company Production Budget For the year ending December 31, 2022 Quarter Quarter 1 Quarter 2 Quarter 3 2.100 2.400 2.900 480 580 780 2,580 2.980 3.680 420 480 580 2.160 2,500 3.100 Expected Unit Sales Add: Desired ending Finished Goods Units Total Required Units Less: Beginning Finished Goods Units Required Production Units Quarter 4 3,900 580 4.480 780 3,700 11,460 Instruction: Use the information below to prepare the Direct Labor Budget. Number of direct labor hours required to produce each unit of finished goods: Expected cost per direct labor hour. 4 $18.00 hours per hour Year Buff Company Direct Labor Budget For the year ending December 31, 2022 Quarter Quarter 1 Quarter 2 Quarter 3 2.160 2.500 3.100 4 4 4 8.640 10,000 12,400 $18.00 $18.00 $18.00 $155,520 $180,000 $223,200 Unit to be Produced Direct Labor Hours per Unit Total Required Direct Labor Hours Direct Labor Cost per Hour Total Direct Labor Cost Quarter 4 3.700 4 14.800 $18.00 $266,400 $825.120.00 Instruction: Buff Company expects variable overhead costs to flucturate with production volume according to the following rates: Indirect Material: Indirect Labor: Utilities: Maintenance: $1.50 $1.30 $0.20 $0.30 per direct labor hour per direct labor hour per direct labor hour per direct labor hour Buff Company also incurs fixed overhead cost. The amounts of fixed overhead are already provided in the budget below. Use the information to complete the Manufacturing Overhead Budget. Buff Company Manufacturing Overhead Budget For the year ending December 31, 2022 Quarter Quarter 1 Quarter 2 Quarter 3 Quarter 4 Year Variable Costs: Indirect Materials ( $1.5/hour) $12.960 $15,000 $18,600 $22,200 $68,760 Indirect Labor ( $1.3/hour) $11,232 $13,000 $16,120 $19,240 $59,592 Utilities ( $0.2/hour) $1,728 $2,000 $2,480 $2.960 $9,168 Maintenance ( $0.3/hour) $2,592 $3,000 $3,720 $4,440 $13,752 Total Variable Costs $28,512 $33,000 $40,920 $48,840 $151,272 Fixed Costs: Supervisory Salaries $5,730 $5,730 $5,730 $5,730 $22,920 Depreciation $3,438 $3,438 $3,438 $3,438 $13,752 Property Taxes and Insurance $2,292 $2,292 $2,292 $2,292 $9,168 Maintenance $4,584 $4,584 $4,584 $4,584 $18,336 Total Fixed Costs $16,044 $16,044 $16,044 $16,044 $64,176 Total Manufacturing Overhead $44,556 $49,044 $56,964 $64.884 $215,448 Direct Labor Hours 8,640 10,000 12,400 14,800 45,840 Predetermined MOH allocation rate* $4.70 This predetermined MOH rate is a traditional MOH rate - using the yearly amounts, compute the budgeted overhead rate per direct labor hour. Instruction: Buff Company maintains an ending inventory equal to 20% of the next quarter's production requirements. Use these information to complete the Direct Material Budget. Assuming only one type of material are used for production 20% 6 lbs Ending Inventory as of next quarter's production requirements: Number of pounds of direct material required for each product: Expected cost per pound: Beginning inventory of direct materials for Quarter 1 of 2022. in pounds: Desired ending inventory of direct materials for Quarter 4 of 2022. in pounds: $8.00 per lb lbs 2,592 3,480 lbs Year Units to be Producted Direct Material per Unit Total Pounds needed for production Add: Desired ending Direct Material, pound Total Material Required Less: Beginning Direct Material, pounds Direct Material Purachases Cost per Pound Total Cost of Direct Material Purchases Buff Company Direct Material Budget For the year ending December 31, 2022 Quarter Quarter 1 Quarter 2 Quarter 3 2.160 2,500 3.100 6 6 6 12,960 15,000 18,600 3.000 3,720 4,440 15.960 18,720 23,040 2,592 3.000 3,720 13,368 15,720 19,320 $8.00 $8.00 $8.00 $106,944 $125,760 $154,560 Quarter 4 3,700 6 22.200 3,480 25,680 4.440 21.240 $8.00 $169,920 $557,184.00 Instruction: Buff Company expects variable selling and administrative expenses to fluctuate with unit sales volume according to the following rate. Sales Commissions: Freight-out* $6.20 $1.80 per unit of goods sold per unit of goods sold Buff Company also incrus fixed selling and administrative expenses. The amounts of fixed selling and administrative expenses are already provided in the budget below. Use the information to complete the Selling and Administrative Expenses Budget. Buff Company Selling and Administrative Expenses Budget For the year ending December 31, 2022 Quarter Quarter 1 Quarter 2 Quarter 3 2,100 2.400 2,900 Year Quarter 4 3,900 $13,020 $3,780 $16,800 $14,880 $4,320 $19,200 $17,980 $5,220 $23,200 $24,180 $7,020 $31,200 $70,000 $20,340 $90,400 Budgeted Sales in Units Variable Expenses: Sales Commissions ( $6.2/unit) Freight-out ( $1.8/unit) Total Variable Expenses Fixed Expenses: Advertising Sales Salaries Office Salaries Depreciation Property Taxes and Insurance Total Fixed Expenses Total Selling and Administrative Expenses $2,100 $20,000 $18,000 $2,200 $2,500 $44,800 $61,600 $2,100 $20,000 $18,000 $2,200 $2,500 $44,800 $64,000 $2,100 $20,000 $18,000 $2,200 $2,500 $44,800 $68,000 $2,100 $20,000 $18,000 $2,200 $2,500 $44,800 $76,000 $8,400 $80,000 $72,000 $8,800 $10,000 $79,200 $269,600 * Freight-out - Costs to get product delivered to custumor ready for use. For example, the transportation costs associated with the delivery are paid by the company (as seller). Similar to Freight-out, Freight-in the the costs associated with getting purchases goods ready to use by the company. For example, the transporation costs are associated with purchased raw materials, supplies, or equipments: these costs are paid by the company (as customer) as addition to the costs of raw materials, supplies, or equipments. Total Instruction: Complete the following schedule to determine the cost of goods sold: Complete 'Manufacturing Overhead Budget' first before you start this budget! Product Cost per Unit Cost Element Source of Data Quantity Unit Cost Direct Material DM Budget 6 Ibs $8.00 Direct Labor DL Budget 4 hours $18.00 Manufacturing Overhead MOH Budget 1 unit per unit Total Unit Cost per 10 per hour Cost of Good Sold Total Unit Cost - Complete the 'Product Cost per Unit' first- Units Sold Budgeted Cost of Good Sold Additional Information Interest Expenses for 2022: Income Tax Rate for 2022: * $600.00 21% Buff Company Budgeted Income Statement For the year ending December 31, 2022 Sales Cost of Good Sold Gross Profit Selling and Administrative Expense Income from Continues Operation Interest Expenses Income before Taxes Income Tax Expenses Net Income * Income tax rate is applied to the "Income before Taxes". By multiply the income before taxes with the tax rate, you could get the income tax expneses. Instruction: Buff Company expects to meet future sales requirements by maintaing an ending inventory equal to 20% of the next quarter's budgted sales volume. Use these information to complete the production budget. 20% Ending Inventory as _ of next quarter's sales volume: Ending Finished Goods Inventory on Decemeber 31, 2021: Expected Sales Volume for Quarter 1 of year 2023: units 420 2.900 units Year Buff Company Production Budget For the year ending December 31, 2022 Quarter Quarter 1 Quarter 2 Quarter 3 2.100 2.400 2.900 480 580 780 2,580 2.980 3.680 420 480 580 2.160 2,500 3.100 Expected Unit Sales Add: Desired ending Finished Goods Units Total Required Units Less: Beginning Finished Goods Units Required Production Units Quarter 4 3,900 580 4.480 780 3,700 11,460 Instruction: Use the information below to prepare the Direct Labor Budget. Number of direct labor hours required to produce each unit of finished goods: Expected cost per direct labor hour. 4 $18.00 hours per hour Year Buff Company Direct Labor Budget For the year ending December 31, 2022 Quarter Quarter 1 Quarter 2 Quarter 3 2.160 2.500 3.100 4 4 4 8.640 10,000 12,400 $18.00 $18.00 $18.00 $155,520 $180,000 $223,200 Unit to be Produced Direct Labor Hours per Unit Total Required Direct Labor Hours Direct Labor Cost per Hour Total Direct Labor Cost Quarter 4 3.700 4 14.800 $18.00 $266,400 $825.120.00 Instruction: Buff Company expects variable overhead costs to flucturate with production volume according to the following rates: Indirect Material: Indirect Labor: Utilities: Maintenance: $1.50 $1.30 $0.20 $0.30 per direct labor hour per direct labor hour per direct labor hour per direct labor hour Buff Company also incurs fixed overhead cost. The amounts of fixed overhead are already provided in the budget below. Use the information to complete the Manufacturing Overhead Budget. Buff Company Manufacturing Overhead Budget For the year ending December 31, 2022 Quarter Quarter 1 Quarter 2 Quarter 3 Quarter 4 Year Variable Costs: Indirect Materials ( $1.5/hour) $12.960 $15,000 $18,600 $22,200 $68,760 Indirect Labor ( $1.3/hour) $11,232 $13,000 $16,120 $19,240 $59,592 Utilities ( $0.2/hour) $1,728 $2,000 $2,480 $2.960 $9,168 Maintenance ( $0.3/hour) $2,592 $3,000 $3,720 $4,440 $13,752 Total Variable Costs $28,512 $33,000 $40,920 $48,840 $151,272 Fixed Costs: Supervisory Salaries $5,730 $5,730 $5,730 $5,730 $22,920 Depreciation $3,438 $3,438 $3,438 $3,438 $13,752 Property Taxes and Insurance $2,292 $2,292 $2,292 $2,292 $9,168 Maintenance $4,584 $4,584 $4,584 $4,584 $18,336 Total Fixed Costs $16,044 $16,044 $16,044 $16,044 $64,176 Total Manufacturing Overhead $44,556 $49,044 $56,964 $64.884 $215,448 Direct Labor Hours 8,640 10,000 12,400 14,800 45,840 Predetermined MOH allocation rate* $4.70 This predetermined MOH rate is a traditional MOH rate - using the yearly amounts, compute the budgeted overhead rate per direct labor hour. Instruction: Buff Company maintains an ending inventory equal to 20% of the next quarter's production requirements. Use these information to complete the Direct Material Budget. Assuming only one type of material are used for production 20% 6 lbs Ending Inventory as of next quarter's production requirements: Number of pounds of direct material required for each product: Expected cost per pound: Beginning inventory of direct materials for Quarter 1 of 2022. in pounds: Desired ending inventory of direct materials for Quarter 4 of 2022. in pounds: $8.00 per lb lbs 2,592 3,480 lbs Year Units to be Producted Direct Material per Unit Total Pounds needed for production Add: Desired ending Direct Material, pound Total Material Required Less: Beginning Direct Material, pounds Direct Material Purachases Cost per Pound Total Cost of Direct Material Purchases Buff Company Direct Material Budget For the year ending December 31, 2022 Quarter Quarter 1 Quarter 2 Quarter 3 2.160 2,500 3.100 6 6 6 12,960 15,000 18,600 3.000 3,720 4,440 15.960 18,720 23,040 2,592 3.000 3,720 13,368 15,720 19,320 $8.00 $8.00 $8.00 $106,944 $125,760 $154,560 Quarter 4 3,700 6 22.200 3,480 25,680 4.440 21.240 $8.00 $169,920 $557,184.00 Instruction: Buff Company expects variable selling and administrative expenses to fluctuate with unit sales volume according to the following rate. Sales Commissions: Freight-out* $6.20 $1.80 per unit of goods sold per unit of goods sold Buff Company also incrus fixed selling and administrative expenses. The amounts of fixed selling and administrative expenses are already provided in the budget below. Use the information to complete the Selling and Administrative Expenses Budget. Buff Company Selling and Administrative Expenses Budget For the year ending December 31, 2022 Quarter Quarter 1 Quarter 2 Quarter 3 2,100 2.400 2,900 Year Quarter 4 3,900 $13,020 $3,780 $16,800 $14,880 $4,320 $19,200 $17,980 $5,220 $23,200 $24,180 $7,020 $31,200 $70,000 $20,340 $90,400 Budgeted Sales in Units Variable Expenses: Sales Commissions ( $6.2/unit) Freight-out ( $1.8/unit) Total Variable Expenses Fixed Expenses: Advertising Sales Salaries Office Salaries Depreciation Property Taxes and Insurance Total Fixed Expenses Total Selling and Administrative Expenses $2,100 $20,000 $18,000 $2,200 $2,500 $44,800 $61,600 $2,100 $20,000 $18,000 $2,200 $2,500 $44,800 $64,000 $2,100 $20,000 $18,000 $2,200 $2,500 $44,800 $68,000 $2,100 $20,000 $18,000 $2,200 $2,500 $44,800 $76,000 $8,400 $80,000 $72,000 $8,800 $10,000 $79,200 $269,600 * Freight-out - Costs to get product delivered to custumor ready for use. For example, the transportation costs associated with the delivery are paid by the company (as seller). Similar to Freight-out, Freight-in the the costs associated with getting purchases goods ready to use by the company. For example, the transporation costs are associated with purchased raw materials, supplies, or equipments: these costs are paid by the company (as customer) as addition to the costs of raw materials, supplies, or equipments. Total Instruction: Complete the following schedule to determine the cost of goods sold: Complete 'Manufacturing Overhead Budget' first before you start this budget! Product Cost per Unit Cost Element Source of Data Quantity Unit Cost Direct Material DM Budget 6 Ibs $8.00 Direct Labor DL Budget 4 hours $18.00 Manufacturing Overhead MOH Budget 1 unit per unit Total Unit Cost per 10 per hour Cost of Good Sold Total Unit Cost - Complete the 'Product Cost per Unit' first- Units Sold Budgeted Cost of Good Sold Additional Information Interest Expenses for 2022: Income Tax Rate for 2022: * $600.00 21% Buff Company Budgeted Income Statement For the year ending December 31, 2022 Sales Cost of Good Sold Gross Profit Selling and Administrative Expense Income from Continues Operation Interest Expenses Income before Taxes Income Tax Expenses Net Income * Income tax rate is applied to the "Income before Taxes". By multiply the income before taxes with the tax rate, you could get the income tax expneses