PR $9-39($Algo$)$ Sales, Production, and Purchases Budgets; Activity$-$Based Overhead Budget $($LO $9-3,9-4,9-5,9-6)$

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Vista Electronics, Incorporated, manufactures two different types of coils used in electric motors. In the fall of the current year, Erica Becker, the controller, compiled the following data.

$*$ Sales forecast for $20$x$0($all units to be shipped in $20$x$0)$:

$$ Product $$ Units $$ Price

$$ Light coil $50,000$ $ $200$

$$ Heavy coil $30,000300$

$$ Raw$-$material prices and inventory levels:

$$ Raw Material $$ Expected Inventories, January $1,20$x$0$ Desired Inventories, December $31,20$x$0$ Anticipated Purchase Price

$$ Sheet metal $28,000$ Pound $32,000$ Pound $$ $ $17$

$$ Copper wire $25,000$ Pound $28,000$ Pound $8$

$$ Platform $5,000$ units $6,000$ units $4$

$$ Use of raw material:

$$ Raw Material $$ Amount Used per Unit

$$ Light Coil $$ Heavy Coil

$$ Sheet metal $3$ Pound $4$ Pound

$$ Copper wire $1$ Pound $2$ Pound

$$ Platform $2$ unit

$$ Direct$-$labor requirements and rates:

$$ Product $$ Hours per Unit $$ Rate per Hour

$$ Light coil $3$ $ $10$

$$ Heavy coil $515$

$$ Finished$-$goods inventories $($in units$)$:

$$ Product $$ Expected January $1,20$x$0$ Desired December $31,20$x$0$

$$ Light coil $15,00020,000$

$$ Heavy coil $8,5009,500$

$$ Production overhead:

$$ Overhead Cost Item $$ Activity$-$Based Budget Rate

$$ Purchasing and material handling $$ $ $0\mathrm{.}60$ per pound of sheet metal and copper wire purchased

$$ Depreciation, utilities, and inspection $$ $ $5\mathrm{.}00$ per coil produced $($either type$)$

$$ Shipping $$ $ $1\mathrm{.}00$ per coil shipped $($either type$)$

$$ General production overhead $$ $ $3\mathrm{.}00$ per direct$-$labor hour

PR $9-39($Algo$)$ Part $2$: Prepare the production budget...

$2.$ Prepare the production budget $($in units$)$ for $20$x$0.$

$3.$ Prepare the raw material purchases budget $($in quantities$)$ for $20$x$0.$

$4.$ Prepare the raw material purchases budget $($in dollars$)$ for $20$x$0.$

$5.$ Prepare the direct$-$labor budget $($in dollars$)$ for $20$x$0.$

$6.$ Prepare the production$-$overhead budget $($in dollars$)$ for $20$x$0.$