Question
Preparing Budgets Sales, Production, Direct Materials Purchases, Direct Labor Cost Budget (Points: 45) The financial director of Belleville Furniture Company requests estimates of sales, production,
Preparing Budgets Sales, Production, Direct Materials Purchases, Direct Labor Cost Budget (Points: 45) The financial director of Belleville Furniture Company requests estimates of sales, production, and other operating data from the various administrative units every month. Selected information concerning sales and production for March is summarized as follows: Estimated sales of Grace and Albert chairs for March by sales territory: Eastern Domestic: Grace 7,500 units at $800/unit Albert 6,000 units at $650/unit Western Domestic: Grace 6,000 units at $720/unit Albert 5,000 units at $575/unit International: Grace 3,500 units at $650/unit Albert 1,500 units at $340/unit Estimated inventories at March 1: Direct Materials: Fabric 5,500 sq. yds. Wood 13,700 lineal ft. Filler 3,800 cu. ft. Springs 3,500 units Finished Products: Grace 1,500 units Albert 300 units Desired inventories at March 31: Direct Materials: Fabric 9,000 sq. yds. Wood 20,000 lineal ft. Filler 5,000 cu. ft. Springs 7,500 units Finished Products: Grace 2,000 units Albert 875 units Direct materials used in production: In manufacture of Grace: Fabric 4.0 sq. yds. per unit of product Wood 16 lineal ft. per unit of product Filler 3.8 cu. ft. per unit of product Springs 14 units per unit of product In manufacture of Albert: Fabric 3.0 sq. yds. per unit of product Wood 12 lineal ft. per unit of product Filler 3.0 cu. ft. per unit of product Springs 12 units per unit of product Direct labor requirements: Grace: Framing Dept. 2.5hrs. at $15/hr. Cutting Dept. 1.0 hrs. at $12/hr. Upholstery Dept. 3.0 hrs. at $16/hr. Albert: Framing dept. 1.5 hrs. at $15/hr. Cutting dept. 0.75 hr. at $12 /hr. Upholstery dept. 2.0 hr. at $16/hr. Anticipated purchase price for direct materials: Fabric $9.00 per sq. yd. Wood $6.00 per lineal ft. Filler $15 per cu. ft. Springs $2.00 per unit Requirements: 1. Prepare a sales budget for March. 2. Prepare a production budget for March. 3. Prepare a direct materials purchases budget for March. 4. Prepare a direct labor cost budget for March.
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