Maurice Tutor

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    Argosy University/ Phoniex University/
    Nov-2005 - Oct-2011

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    Phoniex University
    Oct-2001 - Nov-2016

Category > Accounting Posted 19 Aug 2017 My Price 11.00

Willison Company

Problem 9-52  Direct Materials and Direct Labor Budgets

Willison Company produces stuffed toy animals; one of these is Betty Rabbit. Each rabbit takes 0.2 yards of fabric and six ounces of polyfiberfill. Fabric costs $3.50 per yard, and polyfiberfill is $0.05 per ounce.  Willison  has budgeted  production  of stuffed  rabbits  for the next  four  months  as follows:

Units

 

 

October

20,000

November

40,000

December

25,000

January

30,000

Inventory policy requires that sufficient fabric be in ending monthly inventory to satisfy 15% of the following month’s production needs and sufficient polyfiberfill be in inventory to satisfy 30% of the following month’s production needs. Inventory of fabric and polyfiberfill at the beginning of October equals exactly the amount needed to satisfy the inventory policy.

Each rabbit produced requires (on average) 0.10 direct labor per hour. The average cost of direct labor is $15.50 per hour.

Required:

1.       Prepare a direct materials purchases budget of fabric for the last quarter of the year, show- ing purchases in units and in dollars for each month and for the quarter in total.

2.       Prepare a direct materials purchases budget of polyfiberfill for the last quarter of the year, showing purchases in units and in dollars for each month and for the quarter in total.

3.       Prepare a direct labor budget for the last quarter of the year, showing the hours needed and the direct labor cost for each month and for the quarter in total.

Answers

Maurice Tutor
(5)
Status NEW Posted 19 Aug 2017 02:08 PM My Price 11.00

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