Part 1: Direct Materials Purchases Budget

Killingsworth Publishers Inc. budgeted production of 40,000 diaries in 2016. Paper is required to produce a diary. Assume 117 square yards of paper are required for each diary. The estimated January 1, 2016, paper inventory is 187,000 square yards. The desired December 31, 2016, paper inventory is 164,000 square yards.

If paper costs $0.11 per square yard, determine the direct materials purchases budget for 2016. If required, round your final answer to the nearest dollar. $

Part 2: Direct Labor Cost Budget

Dauber Publishers Inc. budgeted production of 57,000 diaries in 2016. Each diary requires assembly. Assume that three minutes are required to assemble each diary.

If assembly labor costs $16.5 per hour, determine the direct labor cost budget for 2016. Do not round your intermediate calculations but, if required, round your final answer to the nearest dollar. $

Part 3:

Cost of Goods Sold Budget

MyLife Chronicles Inc. budgeted production of 238,900 diaries in 2016. Paper is required to produce a diary. Assume five square yards of paper are required for each diary. The estimated January 1, 2016, paper inventory is 32,400 square yards. The desired December 31, 2016, paper inventory is 30,800 square yards. Paper costs $0.30 per square yard. Each diary requires assembly. Assume that six minutes are required to assemble each diary. Assembly labor costs $12.00 per hour.

Prepare a cost of goods sold budget for MyLife Chronicles Inc. using the information above. Assume the estimated inventories on January 1, 2016, for finished goods and work in process were $25,000 and $19,000, respectively. Also assume the desired inventories on December 31, 2016, for finished goods and work in process were $31,500 and $16,700, respectively. Factory overhead was budgeted at $197,100. Round your interim calculations to nearest cent, if required.

MyLife Chronicles Inc. Cost of Goods Sold Budget For the Year Ending December 31, 2016 $ $ Direct materials: $

$

Cost of direct materials placed in production $

Total work in process during period $

$

$