Question
Question 4 (2 hrs, 50 marks) You have been asked to review the information of Dexter Corp. and prepare elements of the master budget for
Question 4 (2 hrs, 50 marks)
You have been asked to review the information of Dexter Corp. and prepare elements of the master budget for the year ending December 2013.
Given:
A) Balance Sheet:
| Dexter Corp Balance Sheet December 31, 2012 | |||
| ASSETS | LIABILITIES AND EQUITIES | ||
| Current Assets: |
| Current Liabilities: |
|
| Cash. | $ 76,153 | Accounts payable. | $ 23,451 |
| Accounts receivable.... | 26,000 |
|
|
| Inventory: Direct Materials (1,600 kg @ $5).. | 8,000 | Equity: |
|
| Finished Goods (4,600 @ $5.818)...... | 26,764 | Contributed capital. | 151,746 |
|
| 136,917 | Retained earnings | 171,720 |
| Capital Assets: |
| Total equity. | 323,466 |
| Manufacturing property & equipment.. | 320,000 |
|
|
| Less: accumulated amortization. | 110,000 |
|
|
|
| 210,000 |
|
|
| Total Assets | $ 346,917 | Total Liabilities and Equity | $ 346,917 |
B) The units are expected to be sold for $12.50 with the following volumes:
| December 2012 | 22,000 |
| January 2013 | 23,000 |
| February 2013 | 23,500 |
| March 2013 | 40,000 |
| April 2013 | 42,000 |
| May 2013 | 40,000 |
C) Variable manufacturing costs:
|
|
Quantity |
Cost | Cost per Unit | ||
| Direct materials (DM) | 0.4 | kg | $ 5.00 | per kg | $ 2.00 |
| Direct labour (DL) | 0.2 | hours | $ 15.00 | per hour | $ 3.00 |
| Manufacturing Overhead (MOH) (applied on DLH) | 0.2 | hours | $ 8.00 | per hour | $ 1.60 |
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Financial Accounting in an Economic Context
Authors: Jamie Pratt
8th Edition
9781118139424, 9781118139431, 470635290, 1118139429, 1118139437, 978-0470635292
