Production and Direct Labor Cost Budgets

Two-Leg Company manufactures slacks and jeans under a variety of brand names, such as Kickers and 101 Denims. Slacks and jeans are assembled by a variety of different sewing operations. Assume that the sales budget for Kickers and 101 Denims shows estimated sales of 18,520 and 35,750 pairs, respectively, for May. The finished goods inventory is assumed as follows:

	Kickers		101 Denims
May 1 estimated inventory	830		1,010
May 31 desired inventory	310		1,260

Assume the following direct labor data per 10 pairs of Kickers and 101 Denims for four different sewing operations:

	Direct Labor per 10 Pairs
	Kickers		101 Denims
Inseam	17	minutes	11	minutes
Outerseam	21		14
Pockets	6		8
Zipper	10		6
Total	54	minutes	39	minutes

a. Prepare a production budget for May.

Two-Leg Company Production Budget May (assumed data)

	Kickers	101 Denims
Expected units to be sold	fill in the blank f1ac62ff505afb4_1	fill in the blank f1ac62ff505afb4_2
Less May 31 desired inventoryPlus May 1 desired inventoryPlus May 31 desired inventoryPlus May 1 estimated inventoryPlus May 31 estimated inventoryPlus May 31 desired inventory	Plus May 31 desired inventory	Plus May 31 desired inventory
Total units	fill in the blank f1ac62ff505afb4_6	fill in the blank f1ac62ff505afb4_7
Less May 1 desired inventoryLess May 31 desired inventoryLess May 1 estimated inventoryLess May 31 estimated inventoryPlus May 1 estimated inventoryPlus May 1 estimated inventory	Plus May 1 estimated inventory	Plus May 1 estimated inventory
Total units to be produced	fill in the blank f1ac62ff505afb4_11	fill in the blank f1ac62ff505afb4_12

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b. Prepare the May direct labor cost budget for the four sewing operations, assuming a $13 wage per hour for the inseam and outerseam sewing operations and a $16 wage per hour for the pocket and zipper sewing operations.

Two-Leg Company Direct Labor Cost Budget May (assumed data)

	Inseam	Outerseam	Pockets	Zipper	Total
Hours required for production:
Kickers	fill in the blank 78b74301404a079_1	fill in the blank 78b74301404a079_2	fill in the blank 78b74301404a079_3	fill in the blank 78b74301404a079_4
101 Denims	fill in the blank 78b74301404a079_5	fill in the blank 78b74301404a079_6	fill in the blank 78b74301404a079_7	fill in the blank 78b74301404a079_8
Total minutes	fill in the blank 78b74301404a079_9	fill in the blank 78b74301404a079_10	fill in the blank 78b74301404a079_11	fill in the blank 78b74301404a079_12
Convert minutes to hours	fill in the blank 78b74301404a079_13	fill in the blank 78b74301404a079_14	fill in the blank 78b74301404a079_15	fill in the blank 78b74301404a079_16
Hourly rate	x $fill in the blank 78b74301404a079_17	x $fill in the blank 78b74301404a079_18	x $fill in the blank 78b74301404a079_19	x $fill in the blank 78b74301404a079_20
Total direct labor cost	$fill in the blank 78b74301404a079_21	$fill in the blank 78b74301404a079_22	$fill in the blank 78b74301404a079_23	$fill in the blank 78b74301404a079_24	$fill in the blank 78b74301404a079_25