Production, labour, materials and sales budgets Bullen & Company makes and sells upmarket carry bags for...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Production, labour, materials and sales budgets Bullen & Company makes and sells upmarket carry bags for laptop computers. John Crane, controller, is responsible for preparing Bullen's master budget and has assembled the following data for 2016. The direct labour rate includes wages, all employee-related benefits and the employer's share of payroll tax. Labour-saving machinery will be fully operational by March. Also, as of 1 March, the entity's enterprise agreement calls for an increase in direct labour wages that is included in the direct labour rate. Bullen expects to have 10 000 bags in inventory at 31 December 2015, and has a policy of carrying 50 per cent of the following month's projected sales in inventory. 2016 January February March April Estimated unit sales 20000 24000 16000 18000 $ 80 $ 80 $ 75 $ 75 Sales price per unit Direct labour hours per unit Direct labour hourly rate 4.0 4.0 3.5 3.5 $ 15 $ 10 $ 15 $ 10 $ 16 $ 10 $ 16 $ 10 Direct materials cost per unit Required (a) Prepare the following budgets for Bullen & Company for the first quarter of 2016. Be sure to show supporting calculations: (1) production budget in units (ii) direct labour budget in hours (iii) direct materials budget (iv) sales budget. (b) Calculate the total budgeted contribution margin for Bullen & Company for the first quarter of 2016. Be sure to show supporting calculations. (c) Discuss at least three behavioural considerations in the profit- planning and budgeting process. (LO2) Production, labour, materials and sales budgets Bullen & Company makes and sells upmarket carry bags for laptop computers. John Crane, controller, is responsible for preparing Bullen's master budget and has assembled the following data for 2016. The direct labour rate includes wages, all employee-related benefits and the employer's share of payroll tax. Labour-saving machinery will be fully operational by March. Also, as of 1 March, the entity's enterprise agreement calls for an increase in direct labour wages that is included in the direct labour rate. Bullen expects to have 10 000 bags in inventory at 31 December 2015, and has a policy of carrying 50 per cent of the following month's projected sales in inventory. 2016 January February March April Estimated unit sales 20000 24000 16000 18000 $ 80 $ 80 $ 75 $ 75 Sales price per unit Direct labour hours per unit Direct labour hourly rate 4.0 4.0 3.5 3.5 $ 15 $ 10 $ 15 $ 10 $ 16 $ 10 $ 16 $ 10 Direct materials cost per unit Required (a) Prepare the following budgets for Bullen & Company for the first quarter of 2016. Be sure to show supporting calculations: (1) production budget in units (ii) direct labour budget in hours (iii) direct materials budget (iv) sales budget. (b) Calculate the total budgeted contribution margin for Bullen & Company for the first quarter of 2016. Be sure to show supporting calculations. (c) Discuss at least three behavioural considerations in the profit- planning and budgeting process. (LO2)
Expert Answer:
Answer rating: 100% (QA)
a b BUDGETED CONTRIBUTION C BEHAVIOURAL CONSIDERATION 1 Goal ali... View the full answer
Related Book For
Accounting What the Numbers Mean
ISBN: 978-0073527062
9th Edition
Authors: David H. Marshall, Wayne W. McManus, Daniel F. Viele,
Posted Date:
Students also viewed these marketing questions
-
1 In Economics Education, there has been a significant focus on the gender mix of undergraduate programmes in Economics. You should define the true proportion of females within undergraduate...
-
How would decisions about managing forests for carbon sequestration be affected by the speed at which wood building material decay?
-
Is secularization essential to development? Be sure to show you know what secularization is? The two sides of the debate about if it is or is not essential to development. After doing that, you will...
-
Solve Problem using augmented matrix methods. Use a graphing calculator to perform the row operations 5.7x1 - 8.55x2 = -35.91 4.5x1 +5.73x2 = 76.17
-
Combustion analysis of a compound known to contain just C, H, N, and O demonstrated that it is 46.21 wt% C, 9.02 wt% H, 13.74 wt% N, and, by difference, 100 - 46.21 - 9.02 -13.74 = 31.03% O. This...
-
A sample of n captured Pandemonium jet fighters results in serial numbers x1, x2, x3, ... , Xn. The CIA knows that the air craft were numbered consecutively at the factory starting with a and ending...
-
Let $R_{j}^{2}$ be the coefficient of determination when we regress the $j$ th regressor on the other $k-1$ regressors. Show that the $j$ th variance inflation factor may be expressed as...
-
Shortly after July 31, Towanda Corporation received a bank statement containing the following information: December cash transactions and balances on Towanda's records are shown in the following...
-
Suppose the real risk - free rate is 3 . 5 0 % , the average future inflation rate is 2 . 5 0 % , a maturity premium of 0 . 2 0 % per year to maturity applies, i . e . , MRP = 0 . 2 0 % ( t ) , where...
-
Putt Corporation acquired 70 percent of Slice Companys voting common stock on January 1, 20X3, for $158,900. Slice reported common stock outstanding of $100,000 and retained earnings of $85,000. The...
-
America likes to think its immigration laws are tough. Using citations from the article, present how immigration laws are "modest," and not "tough," as most Americans assume. What role does NAFTA...
-
John Smith 40 years old, police officer for Highland Park Police. Plans to retire at age 52 on police pension which will be 40k/year. Has limited savings, 10k at most but has a home that he purchased...
-
Mohan Textiles has imported cotton from Ng Exports inCambodia for Cambodian riel (KHR) 40 million on May 20,and Mohan Textiles will pay the amount on July 20. Teexchange rate on May 20 is INR 1 = KHR...
-
Suppose a company like Target Distribution Centers is looking at 3 mutually exclusive Name Box for locations to build their new Distribution Center. Scenario 1 is a DC in Akron. CAPEX Cost $18...
-
When attorneys prepare for a jury trial, whether it is civil or criminal, they receive a list of potential jurors. A paralegal is often tasked with researching those potential jurors to determine if...
-
You are a Personal Banker at the Lowell Institute for Savings and your bank is running a special rate on High Net Worth Certificates of Deposit (CDs). Customers who deposit $100,000 in a 4 Year CD...
-
What information does the 'Accounts reached' metric provide? describe in detail,
-
1A. If the researcher is concerned about the number of variables, the nature of the analysis, and completion rates, then, he/she is at which stage of the sampling design process (Figure 11.1 in the...
-
Popes Garage had the following accounts and amounts in its financial statements on December 31, 2010. Assume that all balance sheet items reflect account balances at December 31, 2010, and that all...
-
For each of the following costs, check the column(s) that most likelyapply: Cost Variable Fixed Raw materials Staples used to secure packed boxes of product Plant janitors' wages Ordar processing...
-
Grove Co. acquired a production machine on January 1, 2010, at a cost of $240,000. The machine is expected to have a four-year useful life, with a salvage value of $40,000. The machine is capable of...
-
In capital budgeting, a distinction has been made regarding the process of "assessment" as being distinctively different than "evaluation." What is the difference and why is it important?
-
If bond money tends to be the least expensive cost of capital, why do we bother with the WACC in project analysis? It seems like the cost of equity is hard to estimate, and maybe we are just guessing...
-
In developing a capital budgeting portfolio, there are times when a project with a lower return is squeezed in to the budget but a higher-return project is excluded. How can this be fair? Wouldn't...
Study smarter with the SolutionInn App