Prepare a production budget and a direct manufacturing labor cost budget for

PetersonPeterson

Company by month and for the first quarter of

20182018.

You may combine both budgets in one schedule. The direct manufacturing labor cost budget should include labor-hours and show the details for each labor cost category.

Start the schedule by preparing the production budget and calculating the total hours of direct manufacturing labor time needed for the three months in the quarter, then calculate the values for the quarter. Finish by preparing the bottom portion of the schedule for the direct manufacturing labor by month, then quarter. (Enter the direct manufacturing labor-hours per unit to one decimal place, X.X. Do not round interim calculations, and then enter all amounts in the budget [other than the direct manufacturing labor-hours per unit] to the nearest whole number.)

Peterson Company
Budget for Production and Direct Manufacturing Labor
For the Quarter Ended March 31, 2018
	January	February	March
Budgeted sales (units)
Add target ending finished goods inventory (units)
Total requirements (units)
Deduct beginning finished goods inventory (units)
Units to be produced
Direct manufacturing labor-hours per unit
Total hours of direct manufacturing labor time needed

	2018
	January	February	March	April	May
Estimated sales in units	14,000	18,000	9,000	10,000	10,000
Selling price	$55.00	$51.50	$51.50	$51.50	$51.50
Direct manufacturing labor-hours per unit	3.5	3.5	1.5	1.5	1.5
Wage per direct manufacturing labor-hour	$12.00	$12.00	$12.00	$11.00	$11.00