You have been asked to review the information of Dexter Corp. and prepare elements of the master
Question:
You have been asked to review the information of Dexter Corp. and prepare elements of the master budget for the year ending December 2013.
Given:
A) Balance Sheet:
Dexter Corp Balance Sheet December 31, 2012 | |||
ASSETS | LIABILITIES AND EQUITIES | ||
Current Assets: | Current Liabilities: | ||
Cash.…………………………………………………… | $ 76,153 | Accounts payable……………………. | $ 23,451 |
Accounts receivable….………..………………. | 26,000 | ||
Inventory: Direct Materials (1,600 kg @ $5).………. | 8,000 | Equity: | |
Finished Goods (4,600 @ $5.818)…...... | 26,764 | Contributed capital…………………. | 151,746 |
136,917 | Retained earnings…………………… | 171,720 | |
Capital Assets: | Total equity……………………………. | 323,466 | |
Manufacturing property & equipment.. | 320,000 | ||
Less: accumulated amortization…………. | 110,000 | ||
210,000 | |||
Total Assets………………………………………… | $ 346,917 | Total Liabilities and Equity……… | $ 346,917 |
B) The units are expected to be sold for $12.50 with the following volumes:
December 2012 | 22,000 |
January 2013 | 23,000 |
February 2013 | 23,500 |
March 2013 | 40,000 |
April 2013 | 42,000 |
May 2013 | 40,000 |
C) Variable manufacturing costs:
Quantity | Cost | Cost per Unit | |||
Direct materials (DM) | 0.4 | kg | $ 5.00 | per kg | $ 2.00 |
Direct labour (DL) | 0.2 | hours | $ 15.00 | per hour | $ 3.00 |
Manufacturing Overhead (MOH) (applied on DLH) | 0.2 | hours | $ 8.00 | per hour | $ 1.60 |