Exam 8: Master Budgeting

The estimated net operating income (loss)for February is closest to:

Retained earnings at the end of December would be:

One of the weaknesses of budgets is that they are of little value in uncovering potential bottlenecks.

Cardle Corporation makes one product.Budgeted unit sales are shown below: The ending finished goods inventory should equal 30% of the following month's sales.The budgeted required production for February is closest to:

The total needs (i.e., production requirements plus desired ending inventory)of Material K for November are:

The estimated unit product cost is closest to:

One disadvantage of budgeting is that budgeting makes it more difficult to coordinate the activities of the entire organization.

The budgeted direct labor cost per Pod is closest to:

The expected cash collections for February is closest to:

Budgeted sales in Acer Corporation over the next four months are given below: Thirty percent of the company's sales are for cash and 70% are on account.Collections for sales on account follow a stable pattern as follows: 50% of a month's credit sales are collected in the month of sale, 30% are collected in the month following sale, and 20% are collected in the second month following sale.Given these data, cash collections for December should be:

If the company has budgeted to sell 15,000 Debs in February, then the total budgeted fixed selling and administrative expenses for February is:

If the budgeted direct labor time for October is 8,000 hours, then the total budgeted manufacturing overhead for October is:

The company recomputes its predetermined overhead rate every month.The predetermined overhead rate for February should be:

All of Gaylord Corporation's sales are on account.Thirty-five percent of the sales on account are collected in the month of sale, 45% in the month following sale, and the remainder are collected in the second month following sale.The following are budgeted sales data for the company: What is the amount of cash that should be collected in March?

Raimondo Corporation makes one product and has provided the following information: a.The budgeted selling price per unit is $89.Budgeted unit sales for August is 8,300 units. B.Each unit of finished goods requires 4 pounds of raw materials.The raw materials cost $2.00 per pound. C.The direct labor wage rate is $21.00 per hour.Each unit of finished goods requires 2.6 direct labor-hours. D.Manufacturing overhead is entirely variable and is $7.00 per direct labor-hour. The estimated cost of goods sold for August is closest to:

Sthilaire Corporation is working on its direct labor budget for the next two months.Each unit of output requires 0.34 direct labor-hours.The direct labor rate is $11.10 per direct labor-hour.The production budget calls for producing 8,000 units in April and 8,300 units in May.The company guarantees its direct labor workers a 40-hour paid work week.With the number of workers currently employed, that means that the company is committed to paying its direct labor work force for at least 2,840 hours in total each month even if there is not enough work to keep them busy. Required: Construct the direct labor budget for the next two months.

Craney Corporation makes one product and it provided the following information to help prepare the master budget for the next four months of operations: > The budgeted selling price per unit is $87.Budgeted unit sales for January, February, March, and April are 7,100, 8,300, 13,700, and 13,600 units, respectively.All sales are on credit. > Regarding credit sales, 20% are collected in the month of the sale and 80% in the following month. > The ending finished goods inventory equals 40% of the following month's sales. > The ending raw materials inventory equals 40% of the following month's raw materials production needs.Each unit of finished goods requires 5 pounds of raw materials.The raw materials cost $1.00 per pound. > Regarding raw materials purchases, 30% are paid for in the month of purchase and 70% in the following month. > The direct labor wage rate is $19.00 per hour.Each unit of finished goods requires 2.7 direct labor-hours. Required: a.What are the budgeted sales for February? b.What are the expected cash collections for February? c.According to the production budget, how many units should be produced in February? d.If 68,300 pounds of raw materials are needed for production in March, how many pounds of raw materials should be purchased in February? e.What is the estimated cost of raw materials purchases for February? f.If the cost of raw material purchases in January is $43,660, then in February what are the estimated cash disbursements for raw materials purchases? g.What is the total estimated direct labor cost for February assuming the direct labor workforce is adjusted to match the hours required to produce the forecasted number of units produced?

In June the company has budgeted to produce 22,000 Pods.Budgeted direct labor costs incurred in June would be:

Frolic Corporation has budgeted sales and production over the next quarter as follows: The company has 17,500 units of product on hand at July 1.25% of the next month's sales in units should be on hand at the end of each month.October sales are expected to be 97,000 units.Budgeted sales for September would be (in units):

A benefit from budgeting is that it forces managers to think about and plan for the future.