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 2016 is summarized as follows: a. Estimated sales of King and Prince chairs for February by sales territory: Northern Domestic: 610 units at $780 per unit 750 units at $550 per unit King Prince Southern Domestic: 340 units at $780 per unit 440 units at $550 per unit King Prince International 360 units at $850 per unit 290 units at $600 per unit King Prince b. Estimated inventories at February 1: Direct materials: 420 sq. yds. 580 linear ft. Fabric Wood 250 cu. Filler Springs 660 units Finished products: 90 units Prince c. Desired inventories at February 28: Direct materials: 25 units 390 sq. Fabric 650 linear 300 cu. Filler Springs 540 units Finished products: 80 units Prince d. Direct materials used in production In manufacture of King 35 units 6.0 sq yds. per unit of Fabric 38 linear t. per ft. per Wood product 4.2 cu.ft per unit product Springs product In manufacture of Prince yds. per Fabric product ft.per Wood product 3.4 cu. ft per unit product Springs product product 4.2 cu.ft per unit of product 16 units per unit of product Filler Springs n manufacture of Prince 4.0 sq yds. per unit of product 26 linear ft. per unit of product Fabric Wood 3.4 cu. ft per unit of product Filler 12 units per unit of product Springs e. Anticipated purchase price for direct materials: Fabric $12.00 per sq. yd. 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 1.2 hrs. at $12 per hr 0.5 hr. at $14 per hr 0.8 hr. at $15 per hr Framing Department Cutting Department. Upholstery Department Prince: 1.0 hr. at $12 per hr 0.4 hr. at $14 per hr 0.6 hr. at $15 per hr Framing Department Cutting Department. Upholstery Department Required: 1. Prepare a sales budget for February. Royal Furniture Company Sales Budget Required: 1. Prepare a sales budget for February. Royal Furniture Company Sales Budget For the Month Ending February 28, 2016 Unit Sales Volume Unit Selling Price Product and Area Total Sales King Northern Domestic Southerm Domestic International Total Prince Northern Domestic Southern Domestic International Total Total revenue from sales 2. Prepare a production budget for February 2. Prepare a production budget for February. Royal Furniture Company Production Budget For the Month Ending February 28, 2016 Units King Prince Expected units to be sold Plus desired inventory, February 28, 2016 Total Less estimated inventory, February 1, 2016 Total units to be produced 3. Prepare a direct materials purchases budget for February. Royal Furniture Company Direct Materials Purchases Budget For the Month Ending February 28, 2016 Direct Materials Fabric Wood Filler Springs (units) Total (sq. yds.) (linear ft.) (cu. ft.) Required units for production King Prince Accounting numeric field 3. Prepare a direct materials purchases budget for February. Royal Furniture Company Direct Materials Purchases Budget For the Month Ending February 28, 2016 Direct Materials Fabric Wood Filler Springs (units) Total (sq. yds.) (near ft.) (cu. ft.) Required units for production: King Prince Plus desired inventory, February 28, 2016 Total Less estimated inventory, February 1, 2016 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, 2016 Framing Cutting Upholstery Total Required units for production King Prince Plus desired inventory, February 28, 2016 Total Less estimated inventory, February 1, 2016 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, 2016 Cutting Department Department Department Framing UpholsteryTotal Hours required for production King Prince Total Hourly rate Total direct labor cost
