Bramlett Company produces and sells two different product: Thingone and Thingtwo. Company uses two different production...

   

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Bramlett Company produces and sells two different product: Thingone and Thingtwo. Company uses two different production department dedicated for each product. All the other activities in the company are combined in two Support Departments. These Support Departments are responsible of supplying services to the production departments these costs are allocated to each department by using the manufacturing labor hour used. Addition to all the Company has Marketing and Distribution activity fixed costs $680,000 and $362,000 respectively. In 2014 the following data is gathered to prepare the 2015 budget: 2015 PROJECTED SALES Product Units Price Thingone 60,000 $165 Thingtwo 40,000 $220 Budgeted Direct Materials A B C Product Thingone Thingtwo kg $12 kg $5 unit $3 2015 INVENTORIES IN UNITS Ending Inventory 25,000 9,000 Begining Inventory 20,000 8,000 AMOUNT USED PER 2015 INVENTORIES IN UNITS UNIT Unit Unit Thingone Thingtwo Price 4 2 0 5 3 1 Begining Inventory 32,000 29,000 6,000 DIRECT MANUFACTURING LABOR HOURS Hours per Unit 2 3 Rate per Hour $16 $16 Ending Inventory 36,000 32,000 7,000 Support Fixed Department Cost Supl Sup2 Non- $1,200,000 $2,640,000 Fixed Manufacturing Cost Costs Marketing $400,000 Distribution $300,000 Variable Cost $3 $2 Variable Cost Thingone Thingtwo PART A REQUIREMENTS: $2 $0,5 COMPANY'S ASSUMPTIONS IN PREPARATION OF THE BUDGET $4 $0,8 1. The FIFO inventory method is used. 2. Direct Method used while allocating the support department costs to operating departments. 3. Cost of materials and labor are given as an average value therefore there is no price difference expected between months. 1. Prepare the Revenues Budget. 2. Prepare the Production Budget (in Units). 3. Prepare the Direct Material Usage Budget and Direct Material Purchases Budget. 4. Prepare the Direct Manufacturing Labor Costs Budget. 5. Prepare the Manufacturing Overhead Costs Budget. 6. Prepare the Ending Inventories Budget. 7. Prepare the Cost of Goods Sold Budget. 8. Prepare the Nonmanufacturing Cost Budget. 9. Prepare the Budgeted Income Statements. PART B REQUIREMENTS: For the given data below calculate all the variances for Level 1,2, and 3 analysis. Explain the performance of the company. Product Units Price Thingone 58,000 $167 Thingtwo 46,000 $218 Direct Materials A 2015 ACTUAL SALES B C Actual Unit kg Unit Price Changes 4% increase kg 3% unit decrease No change Begining Inventory 20,000 8,000 2015 INVENTORIES IN UNITS Begining Inventory 32,000 2015 INVENTORIES IN UNITS Ending Inventory 27,000 3,000 29,000 6,000 Ending Inventory 30,000 25,000 5,000 All other costs increase 8% comparing to the previous year's prices. But the workers are not happy with this new pricing policy and they slowed the work 4%. PART C REQUIREMENTS: With respect to actual data given in PART C calculate the number of sales from each unit if the company wants to increase the revenue 15%. Assume that the sales mix of budgetted data in PART A is attained. Bramlett Company produces and sells two different product: Thingone and Thingtwo. Company uses two different production department dedicated for each product. All the other activities in the company are combined in two Support Departments. These Support Departments are responsible of supplying services to the production departments these costs are allocated to each department by using the manufacturing labor hour used. Addition to all the Company has Marketing and Distribution activity fixed costs $680,000 and $362,000 respectively. In 2014 the following data is gathered to prepare the 2015 budget: 2015 PROJECTED SALES Product Units Price Thingone 60,000 $165 Thingtwo 40,000 $220 Budgeted Direct Materials A B C Product Thingone Thingtwo kg $12 kg $5 unit $3 2015 INVENTORIES IN UNITS Ending Inventory 25,000 9,000 Begining Inventory 20,000 8,000 AMOUNT USED PER 2015 INVENTORIES IN UNITS UNIT Unit Unit Thingone Thingtwo Price 4 2 0 5 3 1 Begining Inventory 32,000 29,000 6,000 DIRECT MANUFACTURING LABOR HOURS Hours per Unit 2 3 Rate per Hour $16 $16 Ending Inventory 36,000 32,000 7,000 Support Fixed Department Cost Supl Sup2 Non- $1,200,000 $2,640,000 Fixed Manufacturing Cost Costs Marketing $400,000 Distribution $300,000 Variable Cost $3 $2 Variable Cost Thingone Thingtwo PART A REQUIREMENTS: $2 $0,5 COMPANY'S ASSUMPTIONS IN PREPARATION OF THE BUDGET $4 $0,8 1. The FIFO inventory method is used. 2. Direct Method used while allocating the support department costs to operating departments. 3. Cost of materials and labor are given as an average value therefore there is no price difference expected between months. 1. Prepare the Revenues Budget. 2. Prepare the Production Budget (in Units). 3. Prepare the Direct Material Usage Budget and Direct Material Purchases Budget. 4. Prepare the Direct Manufacturing Labor Costs Budget. 5. Prepare the Manufacturing Overhead Costs Budget. 6. Prepare the Ending Inventories Budget. 7. Prepare the Cost of Goods Sold Budget. 8. Prepare the Nonmanufacturing Cost Budget. 9. Prepare the Budgeted Income Statements. PART B REQUIREMENTS: For the given data below calculate all the variances for Level 1,2, and 3 analysis. Explain the performance of the company. Product Units Price Thingone 58,000 $167 Thingtwo 46,000 $218 Direct Materials A 2015 ACTUAL SALES B C Actual Unit kg Unit Price Changes 4% increase kg 3% unit decrease No change Begining Inventory 20,000 8,000 2015 INVENTORIES IN UNITS Begining Inventory 32,000 2015 INVENTORIES IN UNITS Ending Inventory 27,000 3,000 29,000 6,000 Ending Inventory 30,000 25,000 5,000 All other costs increase 8% comparing to the previous year's prices. But the workers are not happy with this new pricing policy and they slowed the work 4%. PART C REQUIREMENTS: With respect to actual data given in PART C calculate the number of sales from each unit if the company wants to increase the revenue 15%. Assume that the sales mix of budgetted data in PART A is attained.

Answer rating: 100% (QA)

PART A BUDGET Revenues Budget Product Units Price Revenue Thingone 60000 165 9900000 Thingtwo 40000 ... View the full answer