Laghari Company Makes And Sells High Quality Glare Filters For Microcomputer Objective 2 Monitors John Tanaka Controll 1 (143.59 KiB) Viewed 90 times
Laghari Company makes and sells high-quality glare filters for microcomputer OBJECTIVE 2 monitors. John Tanaka, controller, is responsible for preparing Laghari's master budget and has assembled the following data for the coming year. The direct labor rate includes wages, all employee-related benefits, and the employer's share of FICA. Labor saving machinery will be fully operational by March. Also, as of March 1, the company's union contract calls for an increase in direct labor wages that is included in the direct labor rate. Laghari expects to have 5,600 glare filters in inventory on December 31 of the current year, and has a policy of carrying 35 percent of the following month's projected sales in inventory. Information on the first four months of the coming year is as follows:
January 36,000 $80 3.0 $18 Estimated unit sales Sales price per unit Direct labor hours per unit Direct labor hourly rate Direct materials cost per unit February 34,500 $80 3.0 $18 March 39,000 $75 April 38,600 $75 2.5 $20 2.5 $20 $9 $9 $9 $9 Required: 1. Prepare the following monthly budgets for Laghari Company for the first quarter of the coming year. Be sure to show supporting calculations. a. Production budget in units b. Direct labor budget in hours c. Direct materials cost budget d. Sales budget 2. Calculate the total budgeted contribution margin for Laghari Company by month and in total for the first quarter of the coming year. Be sure to show supporting calculations. (CMA adapted)
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