Sales, Production, Direct Materials Purchases, and Direct Labor Cost The budget director of Royal British 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 March is summarized as follows: a. Estimated sales of William and Kate chairs for March by sales territory: Eastern Domestic: William 8,250 units at $800 per unit Kate 6,000 units at $650 per unit Western Domestic: William 6,000 units at $700 per unit Kate 5,500 units at $550 per unit International: William 2,500 units at $600 per unit Kate 1,000 units at $350 per unit b. Estimated inventories at March 1: Direct materials: Finished products: Fabric 5,500 sq. yds. William 1,500 units Wood 13,700 lineal ft. Kate 300 units Filler 3,800 cu. ft. Springs 3,500 units c. Desired inventories at March 31: Direct materials: Finished products: Fabric 9,000 sq. yds. William 2,000 units Wood 20,000 lineal ft. Kate 900 units Filler 5,000 cu. ft. Springs 7,500 units d. Direct materials used in production: In manufacture of William: Fabric Wood 4.0 sq. yds. per unit of product 16 lineal ft. per unit of product Filler 3.8 cu. ft. per unit of product Springs 14 units per unit of product In manufacture of Kate: Fabric 2.5 sq. yds. per unit of product Wood 12 lineal ft. per unit of product Filler 3.2 cu. ft. per unit of product Springs 10 units per unit of product e. Anticipated purchase price for direct materials: Fabric $9.00 per sq. yd. Filler $1.50 per cu. ft. Wood 5.00 per lineal ft. Springs 2.00 per unit f. Direct labor requirements: William: Framing Department 2.5 hrs. at $15 per hr Cutting Department 1.0 hr. at $12 per hr. Upholstery Department 3.0 hrs. at $16 per hr. Kate: Framing Department Cutting Department 1.5 hrs. at $15 per hr. 0.5 hr. at $12 per hr. Upholstery Department 2.0 hrs. at $16 per hr. 1. Prepare a sales budget for March. Royal British Furniture Company Sales Budget For the Month Ending March 31 Unit Sales Volume Unit Selling Price Total Sales Product and Area William: Eastern Domestic Western Domestic International Total Kate: Eastern Domestic Western Domestic International Total Total revenue from sales 2. Prepare a production budget for March. Royal British Furniture Company Production Budget For the Month Ending March 31 William Units Kate Units Expected units to be sold Plus desired inventory, March 31 Total Less estimated inventory, March 1 Total units to be produced 3. Prepare a direct materials purchases budget for March. Royal British Furniture Company Direct Materials Purchases Budget For the Month Ending March 31 Fabric (sq. yds.) Wood (lineal ft.) Filler (cu. ft.) Springs (units) Total Required units for production: William Kate Plus desired inventory, March 31 Total Less estimated inventory, March 1 Total units to be purchased Unit price A Total direct materials to be purchased 4. Prepare a direct labor cost budget for March. Royal British Furniture Company Direct Labor Cost Budget For the Month Ending March 31 Framing Department Cutting Department Upholstery Department Total Hours required for production: William Kate Total Hourly rate A LA Total direct labor cost
