The budget director of Outdoor Gourmet Grill Company requests estimates of sales, production, and other operating data from the various administrative units every month. Selected information concerning sales and production for July 2010 is summarized as follows:

a. Estimated sales for July by sales territory:

Maine:

Backyard Chef. . . . . . . . . . . . . . . . 5,000 units at $750 per unit

Master Chef . . . . . . . . . . . . . . . . . 1,800 units at $1,500 per unit

Vermont:

Backyard Chef. . . . . . . . . . . . . . . . 4,200 units at $800 per unit

Master Chef . . . . . . . . . . . . . . . . . 1,600 units at $1,600 per unit

New Hampshire:

Backyard Chef. . . . . . . . . . . . . . . . 4,600 units at $850 per unit

Master Chef . . . . . . . . . . . . . . . . . 1,900 units at $1,700 per unit

b. Estimated inventories at July 1:

Direct materials: Finished products:

Grates. . . . . . . . . . . . . . . . . 1,000 units Backyard Chef . . . . . . 1,400 units

Stainless steel. . . . . . . . . . . 1,800 lbs. Master Chef . . . . . . . 600 units

Burner subassemblies. . . . . 500 units

Shelves. . . . . . . . . . . . . . . . 300 units

c. Desired inventories at July 31:

Direct materials: Finished products:

Grates. . . . . . . . . . . . . . . . . 800 units Backyard Chef . . . . . . 1,600 units

Stainless steel. . . . . . . . . . . 2,100 lbs. Master Chef . . . . . . . 500 units

Burner subassemblies. . . . . 550 units

Shelves. . . . . . . . . . . . . . . . 350 units

d. Direct materials used in production:

In manufacture of Backyard Chef:

Grates . . . . . . . . . . . . . . . . . . . . . 3 units per unit of product

Stainless steel . . . . . . . . . . . . . . . 20 lbs. per unit of product

Burner subassemblies. . . . . . . . . . 2 units per unit of product

Shelves. . . . . . . . . . . . . . . . . . . . . 5 units per unit of product

In manufacture of Master Chef:

Grates . . . . . . . . . . . . . . . . . . . . . 6 units per unit of product

Stainless steel . . . . . . . . . . . . . . . 45 lbs. per unit of product

Burner subassemblies. . . . . . . . . . 4 units per unit of product

Shelves. . . . . . . . . . . . . . . . . . . . . 6 units per unit of product

e. Anticipated purchase price for direct materials:

Grates. . . . . . . . . . . . . . . . . . . $20 per unit Burner subassemblies . . . . $105 per unit

Stainless steel. . . . . . . . . . . . . . $6 per lb. Shelves . . . . . . . . . . . . . . . . $7 per unit

f. Direct labor requirements:

Backyard Chef:

Stamping Department. . . . . . . . . . 0.60 hr. at $18 per hr.

Forming Department. . . . . . . . . . . 0.80 hr. at $14 per hr.

Assembly Department . . . . . . . . . 1.50 hr. at $12 per hr.

Master Chef:

Stamping Department. . . . . . . . . . 0.80 hr. at $18 per hr.

Forming Department. . . . . . . . . . . 1.50 hr. at $14 per hr.

Assembly Department . . . . . . . . . 2.50 hr. at $12 per hr.

Instructions

1. Prepare a sales budget for July.

2. Prepare a production budget for July.

3. Prepare a direct materials purchases budget for July.

4. Prepare a direct labor cost budget for July.