Sales, Production, Direct Materials Purchases, and Direct Labor Cost Budgets
The budget director of Royal Furniture Company requests estimates of sales, production, and other operating data from the various administrative units every month. Selected information concerning sales and production for February is summarized as follows:
Sales, Production, Direct Materials Purchases, and Direct Labor Cost Budgets The budget director of Royal Furniture Company requests estimates of sales, production, and other operating data from the various administrative units every month. Selected information concerning sales and production for February is summarized as follows: a. Estimated sales of King and Prince chairs for February by sales teritory: Northern Domestic: King 610 units at $780 per unit Prince 750 units at $550 per unit Southern Domestic: King 340 units at $780 per unit Prince 440 units at $550 per unit International King 360 units at $850 per unit Prince 290 units at $600 per unit b. Estimated inventories at February 1: Direct materials Fabric Wood Filler Springs 420 sq. yds. 580 linear ft. 250 cu. ft. 660 units Finished products: King 90 units Prince 25 units c. Desired inventories at February 28: Direct materials Fabric Wood Filler Springs 390 sq. yds 650 linear ft. 300 cu. ft 540 units Finished products King 80 units Prince 35 units d. Direct materials used in production: In manufacture of King: Fabric Wood Filler Springs 6.0 sq. yds. per unit of product 38 linear ft. per unit of product 4.2 cu. ft. per unit of product 16 units per unit of product In manufacture of Prince: Fabric Wood Filler Springs 4.0 sq. yds. per unit of product 26 linear ft. per unit of product 3.4 cu. ft. per unit of product 12 units per unit of product e. Anticipated purchase price for direct materials: Fabric Wood Filler Springs f. Direct labor requirements: King $12.00 per sq. yd 7.00 per linear ft. $3.00 per cu. ft. 4.50 per unit Framing Department Cutting Department Upholstery Department 1.2 hrs. at $12 per hr. 0.5 hr. at $14 per hr. 0.8 hr. at $15 per hr. Prince Framing Department Cutting Department Upholstery Department 1.0 hr. at $12 per hr. 0.4 hr. at $14 per hr. 0.6 hr. at $15 per hr. 1. Prepare a sales budget for February. Royal Furniture Company Sales Budget For the Month Ending February 28 Unit sales Volume Unit Selling Price Product and Area Total Sales King: Northern Domestic Southern Domestic International Total Prince: Northern Domestic Southern Domestic International Total Total revenue from sales 2. Prepare a production budget for February. For those boxes in which you must enter subtracted or negative numbers use a minus sign Royal Furniture Company Production Budget For the Month Ending February 28 Units King Prince 3. Prepare a direct materials purchases budget for February. For those boxes in which you must enter subtracted or negative numbers use a minus sign Royal Furniture Company Direct Materials Purchases Budget For the Month Ending February 28 Direct Materials Fabric (sq. yds.) Wood Filler (cu. ft.) Springs (units) Total (linear ft.) Required units for production: King Prince Desired inventory, February 28 Total Estimated inventory, February 1 Total units to be purchased Unit price Total direct materials to be purchased 4. Prepare a direct labor cost budget for February. Royal Furniture Company Direct Labor Cost Budget For the Month Ending February 28 Cutting Upholstery Department Department Department Framing Total Hours required for production: King Prince Total Hourly rate Total direct labor cost
