Exam 8: Activity-Based Costing: a Tool to Aid Decision Making

The following information relates to Marter Manufacturing Corporation for next quarter: How many units should the company plan on producing for the month of February?

Richards Corporation has the following budgeted sales for the first half of next year: The company is in the process of preparing a cash budget and must determine the expected cash collections by month.To this end,the following information has been assembled: The accounts receivable balance on January 1 is $70,000.Of this amount,$60,000 represents uncollected December sales and $10,000 represents uncollected November sales. What is the budgeted accounts receivable balance on May 30?

The LFG Corporation makes and sells a single product,Product T.Each unit of Product T requires 1.4 direct labor-hours at a rate of $9.80 per direct labor-hour.The direct labor workforce is fully adjusted each month to the required workload.LFG Corporation needs to prepare a Direct Labor Budget for the second quarter of next year. The budgeted direct labor cost per unit of Product T is closest to:

Skeete Inc.bases its selling and administrative expense budget on the number of units sold.The variable selling and administrative expense is $1.70 per unit.The budgeted fixed selling and administrative expense is $57,720 per month,which includes depreciation of $9,360.The remainder of the fixed selling and administrative expense represents current cash flows.The sales budget shows 3,900 units are planned to be sold in November. Required: Prepare the selling and administrative expense budget for November.

Mutskic Corporation produces and sells Product BetaC.To guard against stockouts,the company requires that 30% of the next month's sales be on hand at the end of each month.Budgeted sales of Product BetaC over the next four months are: Budgeted production for August would be:

The Gerald Corporation makes and sells a single product called a Clop.Each Clop requires 1.1 direct labor-hours at $8.20 per direct labor-hour.The direct labor workforce is fully adjusted each month to the required workload.The company is preparing a Direct Labor Budget for the first quarter of the year. The budgeted direct labor cost per Clop is closest to:

The direct materials budget is typically prepared before the production budget.

Richards Corporation has the following budgeted sales for the first half of next year: The company is in the process of preparing a cash budget and must determine the expected cash collections by month.To this end,the following information has been assembled: The accounts receivable balance on January 1 is $70,000.Of this amount,$60,000 represents uncollected December sales and $10,000 represents uncollected November sales. The total cash collected during January would be:

The sales budget often includes a schedule of expected cash collections.

The manufacturing overhead budget at Amrein Corporation is based on budgeted direct labor-hours.The direct labor budget indicates that 4,900 direct labor-hours will be required in August.The variable overhead rate is $9.40 per direct labor-hour.The company's budgeted fixed manufacturing overhead is $96,040 per month,which includes depreciation of $7,350.All other fixed manufacturing overhead costs represent current cash flows.The August cash disbursements for manufacturing overhead on the manufacturing overhead budget should be:

Dilbert Farm Supply is located in a small town in the rural west.Data regarding the store's operations follow: o Sales are budgeted at $260,000 for November,$230,000 for December,and $210,000 for January. O Collections are expected to be 80% in the month of sale,19% in the month following the sale,and 1% uncollectible. O The cost of goods sold is 65% of sales. O The company desires to have an ending merchandise inventory at the end of each month equal to 60% of the next month's cost of goods sold.Payment for merchandise is made in the month following the purchase. O Other monthly expenses to be paid in cash are $20,300. O Monthly depreciation is $20,000. O Ignore taxes. The net income for December would be:

When preparing a production budget,the required production equals: