Question
Truong Hai Corporation manufactures mainly two different types of furniture product: chair and table. In the fall of the current year, the controller, showed the
Truong Hai Corporation manufactures mainly two different types of furniture product: chair and table. In the fall of the current year, the controller, showed the following data.
- Sale budget for 2001 (all units to be shipped in this year and on account) | ||||
Product | Units | Price ($) | ||
Chair | 80,000 | 120 | ||
Table | 40,000 | 190 | ||
- Raw material prices and inventory levels: | ||||
Raw material | Expected inventories, 1/1/2001 (kg) | Desired. inventories, 31/12/2001 (kg) | Anticipated purchase price ($) | |
Wood | 42,000 | 36,000 | 8 | |
Sheet metal | 29,000 | 32,000 | 5 | |
Plastic | 6,000 | 7,000 | 3 | |
- Use of raw material | ||||
Raw material | Chair | Table | ||
Wood (kg) | 5 | 7 | ||
Sheet metal (kg) | 5 | 6 | ||
Plastic (kg) | 2 | |||
- Direct labor requirements and rates | ||||
Product | Hours per unit | rate per hour ($) | ||
Chair | 3 | 20 | ||
Table | 5 | 25 | ||
- Finished goods inventories (in units) | ||||
Product | Expected inventories, 1/1/2001 | Desired. inventories, 31/12/2001 | ||
Chair | 2000 | 25,000 | ||
Table | 8,000 | 9,000 | ||
- Production overhead | ||||
Overhead cost activity: | Activity- based budget rate | |||
Purchasing and material handling | $ 0.25 per kg of wood and metal purchased | |||
Depreciation, utilities, and inspection | $4 per chair and table produced | |||
Shipping | $1 per chair and table shipped | |||
general production overhead | $3 per Direct labor hour |
Required: Prepare the following budgets for the year of 2001 1. Sales budget (in dollar) (0.25 points) 2. Production budget (in units) (0.5 points) 3. Raw material purchases budget (in quantities) (0.5 points) 4. Raw material purchases budget (in dollar) (0.5 points) 5. Direct labor budget (in dollar) (0.25 points) 6. Production overhead budget (in dollar) (0.5 points)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started