Sales Budget Production Budget Direct Mtis Budget Direct Lor Factory OH Selling Exp Admin Exp Budget Budget Budget Budget Cost of Income Goods Sold Statement Requirement Prepare the Direct Labor Budget for Johnson Inc.. The product's manufacturing cost is $127 per unit, including per unit costs of $56 for materials (4 lbs. at $14 per lb.), $40 for direct labor (2 hours x $20 direct labor rate per hour), $23 for variable overhead, and $8 for fixed overhead. Johnson Inc. Direct Labor Budget For the year ended December 31, 2018 First Qtr. Second Qtr. Third Qtr. Fourth Qtr. Total Total direct labor hours needed Total budgeted direct labor cost (dollars)
e Problem 3 6 Saved Johnson Inc. has gathered the following budgeting information for next year and has asked you to prepare their master budget. a. Sales for the final quarter of the prior year total 1,200 units. Expected sales in units) for the current year are: 1,080 (Quarter 1). 720 (Quarter 2), 960 (Quarter 3), and 960 (Quarter 4). Sales for the first quarter of the following year total 1,440 units. The selling price is $450 per unit in the first three quarters of the year, and $470 per unit in the final quarter. b. C. Company policy calls for a given quarter's ending finished goods inventory to equal 90% of the next quarter's expected unit sales. The finished goods inventory at the end of the prior year is 972 units, which complies with the policy. The product's manufacturing cost is $127 per unit, including per unit costs of $56 for materials (4 lbs. at $14 per lb.). $40 for direct labor (2 hours $20 direct labor rate per hour), $23 for variable overhead, and $8 for fixed overhead. Annual fixed overhead consists, incurred evenly throughout the year, consist of depreciation on production equipment, $12,900; factory utilities, $16,200, and other factory overhead of $3,252. Company policy also calls for a given quarter's ending raw materials inventory to equal 50% of next quarter's expected materials needed for production. The prior year-end inventory is 1,512 lbs of materials, which complies with the policy. The company expects to have 2.880 lbs. of materials in inventory at year-end. The company has no work in process inventory at the end of any quarter. Sales representatives' commissions are 16% of sales and are paid in the quarter of the sales. The sales manager's quarterly salary will be $53,000 in the first three quarters of the year, and $56,000 in the final quarter. Quarterly general and administrative expenses include $22,000 administrative salaries, rent expense of $13,000 per quarter, insurance expense of $10,000 per quarter, straight- line depreciation of $10,000 per quarter, and 1% monthly interest on the $250,000 long-term note payable (12% annually). f Income taxes will be assessed at 30%, and are paid in the quarter incurred
