Question 5 Lame Specialties manufactures, among other things, woollen blankets for the athletic teams of the two local high schools. The company sews the blankets from fabric and sews on a logo patch purchased from the licensed logo store site. The teams are as follows: Knights, with red blankets and the Knights logo Raiders, with black blankets and the Raider logo Also, the black blankets are slightly larger than the red blankets. The budgeted direct-cost inputs for each product in 2022 are as follows: Knights Blanket Raiders Blanket Red wool fabric 4 yards 0 yards Black wool fabric 0 5 Knight logo patches 1 Raider logo patches Direct manufacturing labour 3 hours 4 hours 0 1 0 Unit data pertaining to the direct materials for April 2022 are as follows: Actual Beginning Direct Materials Inventory (1 April 2022) Knights Blanket Raiders Blanket Red wool fabric 35 yards O yards Black wool fabric 0 15 Knight logo patches 45 0 Raider logo patches 60 0 Target Ending Direct Materials Inventory (30 April 2022) Knights Blanket Raiders Blanket Red wool fabric 25 yards 0 yards Black wool fabric 25 Knight logo patches 25 0 Raider logo patches 0 25 0 Unit cost data for direct-cost inputs pertaining to March 2022 and April 2022 are as follows: Red wool fabric (per yard) Black wool fabric (per yard) Knight logo patches (per patch) Raider logo patches (per patch) March 2022 (actual) April 2022 (budgeted) $9 SIO 12 11 7 7 6 8 Manufacturing labour cost per hour 26 27 Manufacturing overhead (both variable and fixed) is allocated to each blanket on the basis of budgeted direct manufacturing labour-hours per blanket. The budgeted variable manufacturing overhead rate for April 2022 is S16 per direct manufacturing labour-hour. The budgeted fixed manufacturing overhead for April 2022 is $14,640. Both variable and fixed manufacturing overhead costs are allocated to each unit of finished goods. Data relating to finished goods inventory for April 2022 are as follows: Knights Blanket Raiders Blanket Beginning inventory in units 12 17 Beginning inventory in dollars (cost) $1,440 $2,550 Target ending inventory in units 22 27 Budgeted sales for April 2022 are 130 units of the Knights blankets and 190 units of the Raiders blankets. The budgeted selling prices per unit in April 2022 are $229 for the Knights blankets and S296 for the Raiders blankets. Assume the following in your answer: Work-in-process inventories are negligible and ignored. Direct materials inventory and finished goods inventory are costed using the FIFO method. Unit costs of direct materials purchased and finished goods are constant in April 2022 Required: Prepare the following budgets for April 2022: x Revenues budget M Production budget in units ix. Direct material usage budget and direct materials purchases budget w Direct manufacturing labour budget N. Manufacturing overhead budget . Ending inventories budget (direct materials and finished goods) Cost of goods sold budget vii. b. Suppose Lame Specialties decides to incorporate continuous improvement into its budgeting process. Describe two areas where it could incorporate continuous improvement into the budget schedules in requirement a
