Sales, Production, Direct Materials Purchases, and Direct Labor Cost Budgets

The budget director of Gourmet Grill Company requests estimates of sales, production, and other

operating data from the various administrative units every month. Selected information concerning sales

and production for July is summarized as follows:

1. Estimated sales for July by sales territory:

Maine:

Backyard Chef 310 units at $700 per unit

Master Chef 150 units at $1,200 per unit

Vermont:

Backyard Chef 240 units at $750 per unit

Master Chef 110 units at $1,300 per unit

New Hampshire:

Backyard Chef 360 units at $750 per unit

Master Chef 180 units at $1,400 per unit

2. Estimated inventories at July 1:

Direct materials:

Grates 290 units

Stainless steel 1,500 lbs.

Burner subassemblies 170 units

Shelves 340 units

Finished products:

Backyard Chef 30 units

Master Chef 32 units

3. Desired inventories at July 31:

Direct materials:

Grates 340 units

Stainless steel 1,800 lbs.

Burner subassemblies 155 units

Shelves 315 units

Finished products:

Backyard Chef 40 units

Master Chef 22 units

4. Direct materials used in production:

In manufacture of Backyard Chef:

Grates 3 units per unit of product

Stainless steel 24 lbs. per unit of product

Burner subassemblies 2 units per unit of product

Shelves 4 units per unit of product

In manufacture of Master Chef:

Grates 6 units per unit of product

Stainless steel 42 lbs. per unit of product

Burner subassemblies 4 units per unit of product

Shelves 5 units per unit of product

5. Anticipated purchase price for direct materials:

Grates $15 per unit

Stainless steel $6 per lb.

Burner subassemblies $110 per unit

Shelves $10 per unit

6. Direct labor requirements:

Backyard Chef:

Stamping Department 0.50 hr. at $17 per hr.

Forming Department 0.60 hr. at $15 per hr.

Assembly Department 1.00 hr. at $14 per hr.

Master Chef:

Stamping Department 0.60 hr. at $17 per hr.

Forming Department 0.80 hr. at $15 per hr.

Assembly Department 1.50 hrs. at $14 per hr.

Sales Mod 5pdf-Adobe Acrobat Pro Ele Edit wWindow Belp Create 98 % 2 Tools Comment 1. Prepare a sales budget for July Gourmet Grill Company Sales Budget For the Month Ending July 31 Unit Sales Unit Selling Total Sales Product and Area Volume Price Backyard Chef: Maine Vermont New Hampshire Total Master Chef: Maine Vermont New Hampshire Total Total revenue from sales A Sales Med 5pd-Adobe Acrobat Pro X Ele Edit Vew Window Help- T Create 34 98% Tools Comment 2. Prepare a production budget for July. For those boxes in which you must enter subtracted or negative numbers use a minus sign Gourmet Grill Company Production Budget For the Month Ending July 31 Units Backyard Chef Master Chef Expected units to be sold Desired inventory, July 31 Total units Available Estimated Inventory, July 1 Total Units to be produced 3. Prepare a direct materials purchases budget for July. For those boxes in which you must enter subtracted or negative numbers use a minus sign. Sales Mod 5pdf-Adobe Acrobat Pro Ee Edit ew Window Help Create. 150 % Tools Comment 3. Prepare a direct materials purchases budget for July. For those boxes in which you must enter negative numbers use a minus sign subtracted or Gourmet Grill Company Direct Materials Purchases Budget For the Month Ending July 31 Burner Stainless Grates Sub- Shelves Total Steel (units) (Ibs.) assemblies (units) (units) Required units for production: Backyard Chef Master Chef Desired inventory, July 31 Total Estimated inventory, July 1 Total units to be purchased Unit price Total direct materials to be purchased Sales Mod S.pdf Adobe Acrobat Pro Ele Edit Yew Window Help Create / 4 150% Tools Comme 4. Prepare a direct labor cost budget for July. Gourmet Grill Company Direct Labor Cost Budget For the Month Ending July 31 Stamping Forming Assembly Total Department Department Department Hours required for production Backyard Chef Master Chef Total Hourly rate Total direct labor cost