Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Wesley Power Tools manufactures a wide variety of tools and accessories. One of its more popular items is a cordless power handisaw. Use the following

Wesley Power Tools manufactures a wide variety of tools and accessories. One of its more popular items is a cordless power handisaw. Use the following information about this product line to complete the problem requirements. Each handisaw sells for $50. Wesley expects the following unit sales:

January 2,200
February 2,500
March 3,100
April 2,800
May 1,900

Wesleys ending finished goods inventory policy is 30 percent of the next months sales.

Suppose each handisaw takes approximately .55 hours to manufacture, and Wesley pays an average labor wage of $15.50 per hour.

Each handisaw requires a plastic housing that Wesley purchases from a supplier at a cost of $6.00 each. The company has an ending raw materials inventory policy of 10 percent of the following months production requirements. Materials other than the housing unit total $4.00 per handisaw.

Manufacturing overhead for this product includes $69,000 annual fixed overhead (based on production of 24,000 units) and $.80 per unit variable manufacturing overhead. Wesleys selling expenses are 6 percent of sales dollars, and administrative expenses are fixed at $15,000 per month.

image text in transcribed

Required: 1. Compute the budgeted cost of goods sold following for the first quarter. (Round cost per unit to 2 decimal places. Round final answers to the nearest dollar amount.) January February March 1st Quarter Total Budgeted Cost of Goods Sold 2. Compute the budgeted selling and administrative expenses following for the first quarter January February March 1st Quarter Total Budgeted Selling and Administrative Expenses 3. Complete the budgeted income statement for the handisaw product for the first quarter. (Round cost per unit to 2 decimal places. Round final answers to the nearest dollar amount.) WE SLEY POWER TOOLS Budgeted Income Statement For the Quarter Ending March January February March 1st Quarter Total Budgeted Gross Profit Budgeted Net Operating Income

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Software Reviews And Audits A How To Guide For Project Staff

Authors: Dr David Tuffley

1st Edition

1461130468, 978-1461130468

More Books

Students also viewed these Accounting questions