Production and Direct Labor Cost Budgets

Two-Leg Company manufactures slacks and jeans under a variety of brand names, such as Dockers and 501 Jeans. Slacks and jeans are assembled by a variety of different sewing operations. Assume that the sales budget for Dockers and 501 Jeans shows estimated sales of 18,520 and 32,760 pairs, respectively, for May. The finished goods inventory is assumed as follows:

	Dockers	501 Jeans
May 1 estimated inventory	830		920
May 31 desired inventory	310		1,160

Assume the following direct labor data per 10 pairs of Dockers and 501 Jeans for four different sewing operations:

	Direct Labor per 10 Pairs
	Dockers	501 Jeans
Inseam	17	minutes	11	minutes
Outerseam	21		14
Pockets	6		8
Zipper	10		6
Total	54	minutes	39	minutes

Question Content Area

a. Prepare a production budget for May. Prepare the budget in two columns: Dockers and 501 Jeans. For those boxes in which you must enter subtracted or negative numbers use a minus sign.

	Dockers	501 Jeans
Expected units to be sold	fill in the blank d54407fbf016011_1	fill in the blank d54407fbf016011_2
May 1 desired inventoryMay 31 desired inventoryMay 1 estimated inventoryMay 31 estimated inventorySupervisor salaries	- Select -	- Select -
Total units available	fill in the blank d54407fbf016011_6	fill in the blank d54407fbf016011_7
May 1 desired inventoryMay 31 desired inventoryMay 1 estimated inventoryMay 31 estimated inventorySupervisor salaries	- Select -	- Select -
Total units to be produced	fill in the blank d54407fbf016011_11	fill in the blank d54407fbf016011_12

Question Content Area

b. Prepare the May direct labor cost budget for the four sewing operations, assuming a $11 wage per hour for the inseam and outerseam sewing operations and a $16 wage per hour for the pocket and zipper sewing operations. Prepare the direct labor cost budget in four columns: inseam, outerseam, pockets, and zipper.

	Inseam	Outerseam	Pockets	Zipper	Total
Dockers	fill in the blank 5f9788047072052_1	fill in the blank 5f9788047072052_2	fill in the blank 5f9788047072052_3	fill in the blank 5f9788047072052_4
501 Jeans	fill in the blank 5f9788047072052_5	fill in the blank 5f9788047072052_6	fill in the blank 5f9788047072052_7	fill in the blank 5f9788047072052_8
Total minutes	fill in the blank 5f9788047072052_9	fill in the blank 5f9788047072052_10	fill in the blank 5f9788047072052_11	fill in the blank 5f9788047072052_12
Total direct labor hours	fill in the blank 5f9788047072052_13	fill in the blank 5f9788047072052_14	fill in the blank 5f9788047072052_15	fill in the blank 5f9788047072052_16
Direct labor rate	x $fill in the blank 5f9788047072052_17	x $fill in the blank 5f9788047072052_18	x $fill in the blank 5f9788047072052_19	x $fill in the blank 5f9788047072052_20
Total direct labor cost	$fill in the blank 5f9788047072052_21	$fill in the blank 5f9788047072052_22	$fill in the blank 5f9788047072052_23	$fill in the blank 5f9788047072052_24	$fill in the blank 5f9788047072052_25

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