Problem:1

Key Co. manufactures beanies. The budgeted units to be produced and sold are below:

	Expected Production	Expected Sales
August	6,500	6,200
September	7,000	7,100

It takes 5 metres of yarn to produce a beanie. The company's policy to maintain yarn inventory at the end of each month equal to 25% of the next month's production needs and to maintain a finished goods inventory at the end of each month equal to 30% of next month's anticipated production needs. The cost of yarn is $0.75 a metre. At August 1, 4,250 metres of yarn were on hand.

Do a materials purchases budget for August.

Problem: 2

The budget components for McLeod Company for the quarter ended June 30 appear below. McLeod sells garbage cans for $12 each. Budgeted sales of garbage cans for the next four months are:

April 20,000 units

May 50,000 units

June 30,000 units

July 25,000 units

McLeod's desired ending inventory of garbage cans is equal to 20 percent of the following month's budgeted sales in units. On March 31, McLeod had 4,000 completed units on hand. The number of garbage cans to be produced in April and May are 26,000 and 46,000, respectively. Seven kilograms of plastic are required for each garbage can. At the end of each month, McLeod's desired inventory level is 10 percent of the following month's production material needs. At March 31, McLeod had 18,200 kilograms of plastic on hand. The material used in production costs $0.60 per kilogram. Each garbage can produced requires 0.10 hours of direct labour.

How many garbage cans should McLeod produce during the month of June?

Problem: 3

The budget components for McLeod Company for the quarter ended June 30 appear below. McLeod sells garbage cans for $12 each. Budgeted sales and production of garbage cans for the next four months are:

	Sales	Production
April	20,000 units	26,000 units
May	50,000 units	46,000 units
June	30,000 units	29,000 units
July	25,000 units	20,000 units

McLeod's desired ending inventory of garbage cans is equal to 20 percent of the following month's budgeted sales in units. On March 31, McLeod had 4,000 completed units on hand. The number of garbage cans to be produced in April and May are 26,000 and 46,000, respectively. Seven kilograms of plastic are required for each garbage can. At the end of each month, McLeod's desired inventory level is 10 percent of the following month's production material needs. At March 31, McLeod had 18,200 kilograms of plastic on hand. The material used in production costs $0.60 per kilogram. Each garbage can produced requires 0.10 hours of direct labour. Determine how much the materials purchases budget will be for the month ending April 30.

Problem: 4

Seas, Inc. makes and sells buckets. Each bucket uses 3/4 kilogram of plastic. Budgeted production of buckets in units for the next five months is as follows:

	March	April	May	June	July
Budgeted production	22,000	21,000	20,000	24,000	18,000

The company wants to maintain monthly ending inventories of plastic equal to 25% of the following month's budgeted production needs. The cost of plastic is $2.12 per kilogram.

Do a direct materials purchases budget for the month of May.

Problem: 5

Sheller, Inc. makes and sells a single product, widgets. Three kilograms of wackel are needed to make one widget. Budgeted production of widgets for the next few months follows:

September 14,500 units

October 15,500 units

The company wants to maintain monthly ending inventories of wackel equal to 20% of the following month's production needs. On August 31, 8,700 kilograms of wackel were on hand. The cost of wackel is $1.25 per kilogram. How much is the cost of wackel to be purchased in September?

Problem 6

Springer, Inc. produces rulers from plastic resin. On March 1, there are 5,000 completed rulers and 5,200 kilograms of resin on hand. Flyer has estimated production and sales of rulers in units for the next 4 months as:

	March	April	May	June
Estimated production	26,000	22,000	30,000	32,000
Estimated sales	25,000	21,000	33,000	24,000

Each ruler requires 0.25 kilograms of resin. The cost of resin is $4.40 per kilogram. Flyer wants to have 20% of the next month's material requirements on hand at the end of each month.

Calculate a direct materials purchases budget for May.

Problem 6

The Doorjam Company makes the latest in technologically advanced door jams. Its product is in such demand that it needs to protect itself against stock outs of its product. To do so, it calculates that 20% of the next month's sales be on hand at the end of each month. Budgeted unit sales for the next four months are:

April May June July

Monthly budgeted sales 40,000 50,000 60,000 70,000

Instructions

Calculate the budgeted production for June.

Problem 7

The following facts are provided by Breanna Enterprises for March:

• The total kilograms needed for production are 2.5 times the units to be produced.
• The desired ending direct materials inventory is 10% of the total kilograms needed for production in the following month.
• Cost per kilogram is $12.
• Total units to be produced is 280,000 in February, 325,000 in March and 300,000 in April.

Instructions

Determine the direct materials purchases for March.

Problem: 8

Nolo Enterprises is preparing its master budget for 2022. Relevant data pertaining to its sales budget are as follows:

• Sales for the year are expected to total 800,000 units.
• Quarterly sales are 20%, 28%, 31%, and 21%, respectively per quarter.
• The sales price is expected to be $2.00 per unit for the first quarter and will then be increased by 10% each subsequent quarter.

Instructions

Do a sales budget for the third quarter of 2022 for Nolo Company.

Problem: 9

The Doorjam Company makes the latest in technologically advanced door jams. Its product is in such demand that it need to protect itself against stock outs. To do so, it determines that 20% of the next month's sales be on hand at the end of each month. Budgeted unit sales for the next four months are:

April May June July

Monthly budgeted sales 40,000 50,000 60,000 70,000

Instructions

Calculate the budgeted production for June.

Problem: 10

Evans Recycle plans to produce 1,500 recycle bins during April. Each bin requires 1.7 kilograms of plastic and 0.1 hours of direct labour. Plastic costs $2.15 per kilogram. Evans pays its employees $12.50 per hour. Manufacturing overhead is applied at a rate of 150% of direct labour costs. Finished plastic lids are purchased separately from another supplier. Evans has 400 kilograms of plastic in beginning inventory and wants to have 550 kilograms in ending inventory.

Instructions

a) How many kilograms of plastic direct materials should Evans plan to buy during April?

b) How much should Evans budget for direct labour for April?

c) How much manufacturing overhead will be charged to each recycle bin in April?

d) What is the cost per unit of the bins produced in April?