Chapter 13 problem 51 = unanswered

	Direct materials per bag
		1.0 yard cotton at $4 per yard
		0.2 yards canvas finish at $12 per yard
	Direct labor per bag
		0.5 hour at $18 per hour
	Overhead per bag
		Indirect labor		$0.60
		Indirect materials		$0.20
		Power		$0.40
		Equipment costs		$1.30
		Building occupancy		$0.90
	Total overhead per unit			$3.40
Equipment costs and building occupancy are fixed and are based on a normal production of 600,000 unitsper year
Other overhead costs are variable. Plant capacity is sufficient to produce 750,000 units
Labor cost are not expected to change during the year.
The cotton supplier has informed that it will impose a 20% price increase at the coming start of the budget period.
No other costs are expected to change
During the upcoming period sales expects to be 540,000 bags
Finished Goods inventory targeted to increase from the current balance of 120,000 units to 210,000 units.
Production will occur evenily during the year. Inventory levels for cotton and canvas are expected to remain unchanged.
There is no work in progress inventory.
1. Prepare a production budget and estimate the materials, labor, and overhead costs for the coming year.