Oliver, Inc. manufactures model airplane kits and projects production at $550,420,300,$ and $350$ kits for the next four quarters.

$($Click the icon to view the manufacturing information.$)$ decimal places. Round other amounts to the nearest whole number.

Begin by preparing Oliver's direct materials budget.

More info

Direct materials are three ounces of plastic per kit and the plastic costs $$2$ per ounce. Indirect materials are considered insignificant and are not included in the budgeting process. Beginning Raw Materials Inventory is $860$ ounces, and the company desires to end each quarter with $20\%$ of the materials needed for the next quarter's production. Oliver desires a balance of $230$ ounces in Raw Materials Inventory at the end of the fourth quarter. Each kit requires $0\mathrm{.}75$ hours of direct labor at an average cost of $$35$ per hour. Manufacturing overhead is allocated using direct labor hours as the allocation base. Variable overhead is $$0\mathrm{.}70$ per kit, and fixed overhead is $$175$ per quarter.

$$

docs example

Get more help $-$

Check answer

Oliver, Inc. manufactures model airplane kits and projects production at $550,420,300,$ and $350$ kits for the next four quarters.

$($Click the icon to view the manufacturing information.$)$ decimal places. Round other amounts to the nearest whole number.

Begin by preparing Oliver's direct materials budget.

More info

Direct materials are three ounces of plastic per kit and the plastic costs $$2$ per ounce. Indirect materials are considered insignificant and are not included in the budgeting process. Beginning Raw Materials Inventory is $860$ ounces, and the company desires to end each quarter with $20\%$ of the materials needed for the next quarter's production. Oliver desires a balance of $230$ ounces in Raw Materials Inventory at the end of the fourth quarter. Each kit requires $0\mathrm{.}75$ hours of direct labor at an average cost of $$35$ per hour. Manufacturing overhead is allocated using direct labor hours as the allocation base. Variable overhead is $$0\mathrm{.}70$ per kit, and fixed overhead is $$175$ per quarter.

$$

docs example

Get more help $-$

Check answer