Using Sales Budget Provided and Production Budget, please answer the questions (3 AND 4) below. Material is silk, please only do one material. DM quantity per product unit is KG.
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1) Fashion Boutique Sales Budget For Year Ending Dec 31st 2021 Year Product Unit Sales Volume Unit Selling Price Sales Revenue 2020 Best Selling Dress 100,000 $800 80,000,000 2021 Best Selling Dress 130,000 $700 91,000,000 2) Fashion Boutique Production Budget For Year Ending Dec 31st 2021 Particulars Best Selling Dress Expected units to be sold 130,000 Add: Desired ending inventory, Dec 31st, 2021 13,000 Total Units required to be manufactured 117,000 Less: Beginning finished goods units (10,000) Budgeted Production Units 107,000 3) Prepare one Direct Materials (DM) Purchases Budget. a) Keep it simple; 1 type of material is good. b) DM Budget Assumptions: i) ii) iii) iv) v) Use year 2021 product units from the Production Budget (step 2). Determine ending Materials inventory on Dec. 31, 2021. Determine Beginning Materials inventory on Jan. 1, 2021. Determine DM quantity per product unit; Example: pounds (lbs) or kilograms (kg). Determine average DM cost per pound, kilogram, etc. 4) Calculate Average Budgeted Total Variable Cost per product unit (Standard Cost). a) i) ii) iii) Determine additional Budget Assumptions: Direct Materials (DM): Use product specifications from your DM Budget (step 3). Direct Labor (DL): Determine DL hours per product unit, and average DL rate per hour. Factory Overhead (FO): Make up a Predetermined Factory Overhead Rate, and use it to apply FO cost to each unit of your product. How much does it cost to manufacture each unit of your product? Show calculation, please. b) 1) Fashion Boutique Sales Budget For Year Ending Dec 31st 2021 Year Product Unit Sales Volume Unit Selling Price Sales Revenue 2020 Best Selling Dress 100,000 $800 80,000,000 2021 Best Selling Dress 130,000 $700 91,000,000 2) Fashion Boutique Production Budget For Year Ending Dec 31st 2021 Particulars Best Selling Dress Expected units to be sold 130,000 Add: Desired ending inventory, Dec 31st, 2021 13,000 Total Units required to be manufactured 117,000 Less: Beginning finished goods units (10,000) Budgeted Production Units 107,000 3) Prepare one Direct Materials (DM) Purchases Budget. a) Keep it simple; 1 type of material is good. b) DM Budget Assumptions: i) ii) iii) iv) v) Use year 2021 product units from the Production Budget (step 2). Determine ending Materials inventory on Dec. 31, 2021. Determine Beginning Materials inventory on Jan. 1, 2021. Determine DM quantity per product unit; Example: pounds (lbs) or kilograms (kg). Determine average DM cost per pound, kilogram, etc. 4) Calculate Average Budgeted Total Variable Cost per product unit (Standard Cost). a) i) ii) iii) Determine additional Budget Assumptions: Direct Materials (DM): Use product specifications from your DM Budget (step 3). Direct Labor (DL): Determine DL hours per product unit, and average DL rate per hour. Factory Overhead (FO): Make up a Predetermined Factory Overhead Rate, and use it to apply FO cost to each unit of your product. How much does it cost to manufacture each unit of your product? Show calculation, please. b)
