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Silver Corporation has provided the following information to help prepare the master budget for the next four months of operations: Raw materials requirement per unit

Silver Corporation has provided the following information to help prepare the master budget for
the next four months of operations:
Raw materials requirement per unit of output
Raw materials cost
Direct labor requirement per unit of output
Direct labor wage rate
3 pounds
$5.00 per pound
2.2 direct labor-hours
$18.00 per direct labor-hour
Credit sales are collected:
40% in the month of the sale
60% in the following month
Raw materials purchases are paid:
30% in the month of purchase
70% in the following month
The ending finished goods inventory should equal 10% of the following month's sales. The
ending raw materials inventory should equal 40% of the following month's raw materials
production needs.
Required:
a. What are the budgeted sales ($) for February?
b. What are the expected cash collections ($) for February?
c. What is the budgeted accounts receivable balance ($) at the end of February?
d. According to the production budget, how many units should be produced in February?
e. If 32,400 pounds of raw materials are needed for production in March, how many pounds of
raw materials should be purchased in February?
f. What is the estimated cost of raw materials purchases ($) for February?
g. If the cost of raw material purchases in January is $145,680, then in February what are the
total estimated cash disbursements ($) for raw materials purchases?
h. What is the estimated accounts payable balance ($) at the end of February?
i. What is the estimated raw materials inventory balance ($) at the end of February?
j. What is the total estimated direct labor cost for February?
k. If the variable overhead rate is $8.60 per direct labor-hour and the company's budgeted fixed
manufacturing overhead is $107,970 per month, which includes depreciation of $9,760, what is
the cash disbursement for manufacturing overhead($)?
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