Required information

Use the following information for the Exercises below.

Ramos Co. provides the following sales forecast and production budget for the next four months:

	April		May		June		July
Sales (units)	670		750		700		770
Budgeted production (units)	610		740		710		710

The company plans for finished goods inventory of 290 units at the end of June. In addition, each finished unit requires 5 pounds of direct materials and the company wants to end each month with direct materials inventory equal to 20% of next months production needs. Beginning direct materials inventory for April was 610 pounds. Direct materials cost $2 per pound. Each finished unit requires 0.50 hours of direct labor at the rate of $16 per hour. The company budgets variable overhead at the rate of $20 per direct labor hour and budgets fixed overhead of $9,700 per month.

Exercise 22-9 Manufacturing: Direct labor and factory overhead budgets LO P1

1. Prepare a direct labor budget. 2. Prepare a factory overhead budget for April, May, and June. Complete this question by entering your answers in the tabs below.

Required 1

Prepare a direct labor budget. (Enter your direct labor hours (hrs.) per unit in two decimal places.)

RAMOS CO.
Direct Labor Budget
For April, May, and June
	April	May	June
Budgeted production (units)	610	740	710	units
Total labor hours needed
Budgeted direct labor cost

Prepare a factory overhead budget for April, May, and June.

RAMOS CO.
Factory Overhead Budget
For April, May, and June
	April	May	June
Total labor hours needed
Budgeted variable overhead
Budgeted fixed overhead
Total budgeted factory overhead