The budget director for Bird House Unlimited, Inc., has gathered the following data for use in developing the budgeted income statement for January 2020.

 Questions

Prepare a cost of goods sold budget for January.
Prepare a selling and administrative budget for January, set up based on the categorization of expenses into selling and administrative costs.
Prepare a budgeted income statement for January.
What if the company decides to start a new advertising campaign that will increase the total advertising expense to a total of $180,000 and the estimated salesof birdhouse would increase to 36,000 units and Bird Feeders would increase to 29,000 units.
What budgets changed? What would be the new budgeted income?
Would you recommend this advertising campaign? Why?

Transcribed Image Text:

Estimated sales for January Amount Units Bird House 34,000 units 25,000 units $42 per unit $70 per unit at Bird Feeder at Direct materials Estimated inventories at January 1(beginning) Wood Plastic 2600 feet 3200 pounds Estimated inventories at January 31st(ending) Wood 3500 feet Plastic 2800 pounds Direct materials used in production: In the manufacture of a Bird House: Wood 0.80 feet per unit of product 0.50 pounds per unit of product Plastic In the manufacture of a Bird Feeder: Wood 1.20 feet per unit of product 0.75 pounds per unit of product Plastic Estimated cost of direct materials Wood $6.50 per feet $0.90 per pound Plastic Work in process-given in total of the 2 products Estimated inventories at January 1(beginning) Estimated inventories at January 31st(ending) $27,000 $32,400 Estimated sales for January Amount Units Bird House 34,000 units 25,000 units $42 per unit $70 per unit at Bird Feeder at Direct materials Estimated inventories at January 1(beginning) Wood Plastic 2600 feet 3200 pounds Estimated inventories at January 31st(ending) Wood 3500 feet Plastic 2800 pounds Direct materials used in production: In the manufacture of a Bird House: Wood 0.80 feet per unit of product 0.50 pounds per unit of product Plastic In the manufacture of a Bird Feeder: Wood 1.20 feet per unit of product 0.75 pounds per unit of product Plastic Estimated cost of direct materials Wood $6.50 per feet $0.90 per pound Plastic Work in process-given in total of the 2 products Estimated inventories at January 1(beginning) Estimated inventories at January 31st(ending) $27,000 $32,400

Answer rating: 100% (QA)

budgeted cost of goods sold bird house 1 bird feeder 2 1 2 direct materials 176800 195000 371800 15300 16875 32175 32175 direct labor 119000 157500 27... View the full answer