Lalonde Specialties manufactures, among otherthings, woolen blankets for the athletic teams of the two local high schools.

Additional Information

The company sews the blankets from fabric and sews on a logo patch purchased from the licensed logo store site. The teams are as follows:

Broncos with red blankets and the Broncos logo

Rams, with black blankets and the Rams logo

Also, the black blankets are slightly larger than the red blankets

Budgeted Direct Cost information

	Broncos Blanket		Rams Blanket
Red wool fabric	9	yards	0	yards
Black wool fabric	0		10
Broncos logo patches	1		0
Rams logo patches	0		1
Direct manufacturing labor	8	hours	9	hours

Direct Materials March 2017

Actual Beginning Direct Materials Inventory (3/1/2017)
	Broncos Blanket		Rams Blanket
Red wool fabric	60	yards	0	yards
Black wool fabric	0		40
Broncos logo patches	70		0
Rams logo patches	0		85

Target Ending Direct Materials Inventory (3/31/2017)
	Broncos Blanket		Rams Blanket
Red wool fabric	50	yards	0	yards
Black wool fabric	0		50
Broncos logo patches	50		0

Unit cost data for direct cost inputs pertaining to Feb 2017 and March 2017 are as follows

	February 2017 (actual)		March 2017 (budgeted)
Red wool fabric (per yard)	$14		$15
Black wool fabric (per yard)	22		21
Broncos logo patches (per patch)	12		12
Rams logo patches (per patch)	11		13
Manufacturing labor cost per hour	31		32

Manufacturing overhead (both variable and fixed) is allocated to each blanket on the basis of budgeted direct manufacturing labor-hours per blanket.

Overhead information

The budgeted variable manufacturing overhead rate for March 2017 is $ 21 per direct manufacturing labor-hour. The budgeted fixed manufacturing overhead for March 2017 is $24,815. Both variable and fixed manufacturing overhead costs are allocated to each unit of finished goods.

Data relating to finished goods inventory for March 2017 are as follows

	Broncos Blanket		Rams Blanket
Beginning inventory in units	22		27
Beginning inventory in dollars (cost)	$3,960		$4,293
Target ending inventory in units	32		37

Additional Information

Budgeted sales for March 2017 are 180 units of the Broncos blankets and 215 units of the Rams blankets. The budgeted selling prices per unit in March 2017 are $709 for the Broncos blankets and $816 for the Rams blankets. Assume the following in your answer:

Work-in-process inventories are negligible and ignored.

Direct materials inventory and finished goods inventory are costed using the FIFO method.

Unit costs of direct materials purchased and finished goods are constant in March 2017.

Requirements

1.	Prepare the following budgets for March 2017:
	a.	Revenues budget
	b.	Production budget in units
	c.	Direct material usage budget and direct material purchases budget
	d.	Direct manufacturing labor costs budget
	e.	Manufacturing overhead costs budget
	f.	Ending inventories budget (direct materials and finished goods)
	g.	Cost of goods sold budget
2.	Suppose Liam Specialties decides to incorporate continuous improvement into its budgeting process. Describe two areas where it could incorporate continuous improvement into the budget schedules in requirement 1.