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[The following information applies to the questions displayed below.] Vista Electronics, Inc. manufactures two different types of coils used in electric motors. In the fall
[The following information applies to the questions displayed below.]
Vista Electronics, Inc. manufactures two different types of coils used in electric motors. In the fall of the current year, Erica Becker, the controller, compiled the following data.
- Sales forecast for 20x0 (all units to be shipped in 20x0):
Product | Units | Price | ||||
Light coil | 58,000 | $ | 280 | |||
Heavy coil | 38,000 | 380 | ||||
- Raw-material prices and inventory levels:
Raw Material | Expected Inventories, January 1, 20x0 | Desired Inventories, December 31, 20x0 | Anticipated Purchase Price | ||||||||
Sheet metal | 36,000 | lb. | 40,000 | lb. | $ | 15 | |||||
Copper wire | 33,000 | lb. | 36,000 | lb. | 8 | ||||||
Platform | 5,800 | units | 6,800 | units | 4 | ||||||
- Use of raw material:
Amount Used per Unit | |||||||
Raw Material | Light Coil | Heavy Coil | |||||
Sheet metal | 4 | lb. | 5 | lb. | |||
Copper wire | 2 | lb. | 3 | lb. | |||
Platform | 2 | unit | |||||
- Direct-labor requirements and rates:
Product | Hours per Unit | Rate per Hour | |||||
Light coil | 3 | $ | 15 | ||||
Heavy coil | 5 | 20 | |||||
- Finished-goods inventories (in units):
Product | Expected January 1, 20x0 | Desired December 31, 20x0 | |||||
Light coil | 23,000 | 28,000 | |||||
Heavy coil | 9,500 | 10,500 | |||||
- Production overhead:
Overhead Cost Item | Activity-Based Budget Rate | ||
Purchasing and material handling | $ | 0.80 | per pound of sheet metal and copper wire purchased |
Depreciation, utilities, and inspection | $ | 7.00 | per coil produced (either type) |
Shipping | $ | 2.00 | per coil shipped (either type) |
General production overhead | $ | 5.00 | per direct-labor hour |
Required:
-
Prepare the sales budget (in dollars) for 20x0.
-
Prepare the production budget (in units) for 20x0.
-
Prepare the raw material purchases budget (in quantities) for 20x0.
-
epare the raw material purchases budget (in dollars) for 20x0.
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