Miyasaki Limited is a manufacturer of model ACC203. Next five quarters' projected sales for ACC203 are as stated below:

Model: ACC203	Units
Quarter 1 of 2018	3,800
Quarter 2 of 2018	4,200
Quarter 3 of 2018	7,600
Quarter 4 of 2018	8,600
Quarter 1 of 2019	4,800

 

The company maintains an ending inventory of ACC203 equal to 25% of the next quarter's sales.

In addition, the finished product ACC203 uses 8 units of component part ACC311 which cost the company $10.70 per unit. The company expects to maintain an ending inventory of component ACC311 equal to 15% of the next quarter's projected usage.

 

Direct labour per unit of ACC203 takes two-third of an hour to produce and direct labour costs the company $9.00 per hour. However, if production exceeds 4,500 units of ACC203 per quarter, over-time rate is double the existing hourly rate for subsequent units of ACC203 produced.

 

Required:

 

(a) Do the production budget in units for model ACC203 for each of the four quarters of 2018 and for the whole year of 2018.

 

(b) Construct the direct material purchase budget (in units and dollars) of component part ACC311 for each of the first two quarters of 2018.

 

(c) Construct the budget for labour cost for each of the first two quarters of 2018.