Answer Happy

Production, direct materials, and direct labor budgets Gerrad Manufacturing has projected sales of its product for the next six months as follows: 480 units January February 1120 units March 1,600 units 1440 units 640 units 480 units April May June The finished product requires 3 pounds of raw material and 10 hours of direct labor. Gerrad tries to maintain a Finished Goods ending inventory equal to the next two months of sales and a Raw Material ending inventory equal to one-half of the current month's production needs. January's beginning inventories are expected to conform to company policy. a. Prepare a production budget for February, March, and April. Note: Use a negative sign in your schedule to indicate that an amount is subtracted. March February 1.120 ✔ 3,040 ✓ 4,160✔ 2,720 x 1,440 ✔ Sales B Total units needed 51 Units produced 1,600✔ 2,080 3,680 ✓ 3,040 x 640 ✔ Reged raw material units b. Prepare a forecast of the units and cost of raw material that will be required for February, March, and April. The expected cost per pound of raw material is expected to be $2 in February, $2.30 in March, and $2.40 in April. February April 4,320 x 1,440 ✔ 1,120 ✓ 2,560 ✓ 2,080 x 480 ✔ March 1,920 x IMG April 1,440 x 2.156 X 4:34 AM
b. Prepare a forecast of the units and cost of raw material that will be required for February, March, and April. The expected cost per pound of raw material is expected to be $2 in February, $2.30 in March, and $2.40 in April. Units produced DLHS per unit Total hours Cost per DLH Cost of DL S $ February Required raw material units Cost of raw material purchases $ c. Prepare a direct labor budget (assuming a $12 per hour rate) for February, March, and April. February March April 1,440✔ 10- 14,400✔ 12 S 172,800✔ S 4.320 N 8,640 x 5 March 1.920 X 4,416 X S 640✔ 10✔ 6,400✔ 12 $ 76,800 $ April 1,440 X 3,456 X 480✔ 10✔ 4,800✔ 12 ✔ 57,600✔
Production budget Nafari Company's sales budget has the following unit sales projections for each quarter of Year 4: Unit Sales 645.000 $16,000 588,000 660,000 2.712,000 Quarter January-March April-June July-September October-December Total Sales for the first quarter of Year 5 are expected to be 720,000 units. Ending inventory of finished goods for each quarter is scheduled to equal 10 percent of the next quarter's budgeted sales. The company's ending inventory on December 31, Year 3, is estimated at 56,700 units. Develop a quarterly production budget for Year 4 and for Year 4 in total. Note: Use a negative sign in your schedule to indicate that an amount is subtracted. Sales E Total BI Production 1st 643.000 ✓ 81,600✔ 729.600 ✔ (56.700) ✔ 672.900 ✔ 2nd 816,000 ✓ 58,800✔ 874,800✔ (81,600) ✔ 793.200✔ QUARTER 3rd 588,000 66,000 654,000✔ (58,800) 595,200 4th 660,000 ✓ 72,000 ✓ 732,000 ✓ (66,000) ✔ 666,000 ✓ Total 2.712,000 ✓ 278,400 x 2,990,400 x (263,100) x 2,727,300✔