Question
Shadee Corp. expects to sell 590 sun visors in May and 350 in June. Each visor sells for $18. Shadees beginning and ending finished goods
Shadee Corp. expects to sell 590 sun visors in May and 350 in June. Each visor sells for $18. Shadees beginning and ending finished goods inventories for May are 65 and 55 units, respectively. Ending finished goods inventory for June will be 55 units.
Each visor requires a total of $4.00 in direct materials that includes an adjustable closure that the company purchases from a supplier at a cost of $2.50 each. Shadee wants to have 31 closures on hand on May 1, 20 closures on May 31, and 27 closures on June 30. Additionally, Shadees fixed manufacturing overhead is $1,000 per month, and variable manufacturing overhead is $2.00 per unit produced. Required: 1. Determine Shadee's budgeted cost of closures purchased for May and June. (Round your answers to 2 decimal places.) 2. Determine Shadee's budget manufacturing overhead for May and June. (Do not round your intermediate values. Round your answers to 2 decimal places.)
3. Suppose that each visor takes 0.40 direct labor hours to produce and Shadee pays its workers $8 per hour. Determine Shadee's budgeted direct labor cost for May and June. (Do not round your intermediate values. Round your answers to 2 decimal places.)
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