Question

Seer Company has projected product sales for the next six months as follows:
January ..... 40 units
February .... 90 units
March ..... 100 units
April ...... 80 units
May ....... 30 units
June ....... 70 units
The product sells for $100 per unit, variable costs are $70 per unit, and fixed costs are $1,500 per month. The finished product requires 3 units of raw material and 10 hours of direct labor. The company tries to maintain an ending inventory of finished goods equal to the next two months of sales and an ending inventory of raw materials equal to half of the current month’s usage.

REQUIRED
A. Prepare a production budget for February, March, and April.
B. Prepare a direct materials requirements and purchases budget for February, March, and April.
C. Prepare a schedule of the direct labor hour requirements for February, March, and April.



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  • CreatedJanuary 26, 2015
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