Exercise $20-15($Algo$)$ Manufacturing: Direct materlals, direct labor, and overhead budgets LO P$1$

MCO Leather manufactures leather purses. Each purse requires $2$ pounds of direct materials at a cost of $$4$ per pound and $0\mathrm{.}7$ direct

labor hour at a rate of $$16$ per hour. Variable overhead is budgeted at a rate of $$3$ per direct labor hour. Budgeted fixed overhead is

$$17,000$ per month. The company's policy is to end each month with direct materials inventory equal to $30\%$ of the next month's direct

materials requirement. At the end of August the company had $2,700$ pounds of direct materials in inventory. The company's production

budget reports the following.

$(1)$ Prepare direct materials budgets for September and October.

$(2)$ Prepare direct labor budgets for September and October.

$(3)$ Prepare factory overhead budgets for September and October.

Complete this question by entering your answers in the tabs below.

Prepare direct materials budgebs for September and October