Note: You must complete part A before completing parts B and C. Genuine Spice Inc. began operations on January 1 of the current year. The company produces 8-ounce bottles of hand and body Beauty. The lotion is sold wholesale in 12-bottle cases for $100 per case. There is a selling commission of $20 per case. The Jam direct labor, and factory overhead costs are as follows: Cost Behavior DIRECT MATERIALS Units per Case 100 oz. 30 ozs. 12 bottles Direct Materials Cost per Case $2.00 9.00 Cream base Cost per Unit $0.02 0.30 0.50 Variable Natural oils Variable Bottle (8-oz.) Variable 6.00 $17.00 DIRECT LABOR Department Cost Behavior Time per Case Labor Rate per Hour Direct Labor Cost per Case Mixing Variable 20 min. $18.00 $6.00 Filling Variable 14.40 1.20 25 min. $7.20 10 Check My Works used Lost Behavior Utilities Mixed $600 14,000 Fixed Facility lease Equipment depreciation Supplies Fixed 4,300 Fixed 660 $19,560 Part A-Break-Even Analysis The management of Genuine Spice Inc. wishes to determine the number of cases required to break even per month. The uti factory overhead, is a mixed cost. The following information was gathered from the first six months of operation regarding Month Case Production Utility Total Cost January 500 $600 February 800 660 March 1,200 740 April 1,100 May 950 June 1,025 10 Check My Works used Selected item Attempt Preview Preview in Window Required: Comprehensive Problem Par 1. Determine the fixed and variable portions of the utility cost using the high-low method. Round the per unit cost to the nearest At the High Point At the Low Point $ 240 X 100 Variable cost per unit Total fixed cost 500 500 Total cost 740 600 2. Determine the contribution margin per case. Enter your answer to the nearest cent. Contribution margin per case $ 55.60 3. Determine the fixed costs per month, including the utility fixed cost from part (1). Utilities cost (from part 1) 500 Facility lease 14,000 Equipment depreciation 4,300 Supplies 660 Total fixed costs 19,460 4. Determine the break-even number of cases per month 350 cases 10 Check My Works used eBOOK Casus 300 Estimated finished goods inventory, August 1 Desired finished goods inventory, August 31 CUSE $12,000 7,000 Materials Inventory: Cream (ozs.) (ozs.) 290 Bottles (bottles) 600 Estimated materials inventory, August 1 250 Desired materials inventory, August 31 1,000 360 360 240 There was negligible work in process inventory assumed for either the beginning or end of the month; thus, none was assur cost per unit or estimated units per case operating data from January. Required: 5. Prepare the August production budget. Enter all amounts as positive numbe Genuine Spice Inc. Production Budget For the Month Ended August 31 Expected cases to be sold Cases 1,500 175 Desired ending inventory Total units available 1,675 Estimated beginning inventory 300 Total units to be produced 1,375 Genuine Spice Inc. Direct Materials Purchases Budget For the Month Ended August 31 Cream Base (ozs.) Natural Oils (ozs.) Bottles (bottles) Total 7. Prepare the August direct labor cost budget. For hours required, round to nearest whole hour. For hourly rate, enter to the nearest cent, if Genuine Spice Inc. Direct Labor Cost Budget For the Month Ended August 31 Hours required for productio of: Mixing Filling Total 8. Prepare the August factory overhead cost budget. If an amount box does not require an entry, leave it blank. ONEGHIERA Cost Behavior Cost per Unit Direct Materials Cost per Case Variable Units per Case 100 oz. 30 ozs. 12 bottles Cream base Natural oils $2.00 $0.02 0.30 Variable 9.00 Bottle (8-oz.) Variable 0.50 6.00 $17.00 Department Cost Behavior Variable Variable DIRECT LABOR Time Labor Rate per Case per Hour 20 min. $18.00 14.40 25 min. Direct Labor Cost per Case $6.00 Mixing Filling 1.20 $7.20 FACTORY OVERHEAD Cost Behavior Total Cost Utilities Mixed Facility lease Fixed $600 14,000 4,300 Fixed Equipment depreciation Supplies Fixed 660 $19,560 Part B - August Budgets