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Budget Assignment
Gurveer kaur #1114507
Fanshawe college (Simcoe campus)
ACCT-5012 Managerial Accounting
Professor Brian Wills
April 6, 2023
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Answer 1: - Cash received during November
= (40%0f November Sales) + (60%ofOctober Sales)
= 40% x $340,000 + 60% x $320,000
= $136,000 + $192,000
= $328,000
Answer 2: -
Graver Industry
Production budget
For the first quarter of 2022
Quarter
January February March First Quarter
Units to be produced 10,000 8,000 9,000
Add: Desired ending 1,600 1,800 2,200
Finished goods units
Total required units 11,600 9,800 11,200
Less: Beginning finished 2,000 1,600 1,800
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Goods units
Required Production $9600 $8200 $9400 $27,200
Units
Graver Industry
Direct materials budget
For the first quarter of 2022
Quarter
January February March First quarter
Units to be produced 9600 8200 9400
Direct materials per unit *3 *3 *3
Total pounds needed for 28,800 24,600 28,200
Production
Add: Desired ending direct 7,380 8,460 10,620
Materials (Pounds)
Total materials required 36,180 33,060 38,820
Less: Beginning direct 8,640 7,380 8,460
Materials (Pounds)
Direct material purchases 27,540 25,680 30,360
Cost per pound *4 *4 *4
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Total cost of direct materials $110,160 $102,720 $121,440 $334320
Purchases
Answer 3: -
Thread Company
Manufacturing Overhead budget for the year 2022
Quarter
1 2 3 4 Year
Units Produced 10,000 12,000 14,000 16,000
Direct Labour time per unit *1 *1 *1 *1
Direct labour hours 10,000 12,000 14,000 16,000
Variable Costs
Indirect materials 8000 9600 11200 12800
($0.80/hour)
Indirect labour ($1.20/hour) 12000 14400 16800 19200
Maintenance ($0.50/hour) 5000 6000 7000 8000
Total Variable Costs 25000 30000 35000 40000
Fixed Costs
Supervisory salary 42,000 42,000 42,000 42,000
Depreciation 16,000 16,000 16,000 16,000
Maintenance 12,000 12,000 12,000 12,000
Total Fixed Costs 70,000 70,000 70,000 70,000
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Total manufacturing overhead 95,000 100,000 105,000 110,000 410000
Direct labour hours 10,000 12,000 14,000 16,000 52000
Manufacturing overhead rate per direct labour hour ($410000/$52000) $7.88
Answer 4: -
Point Inc.
Static Budget Report for the year 2022
Quarter
Difference
Favourable-F
Budget Actual Unfavourable-U
Production in units 2500 2800
Variable Costs Direct Materials $65,000 - $75,000 = $10,000 U
Direct Labour $70,000 - $78,000 = $8,000 U
Total Variable costs $135,000 - $153,000 = $18,000 U
Fixed Overhead $35,000 - $34,500 = $500 F
Total Costs $170,000 - $187,500 = $17,500 U
Note:
While fixed overhead is a fixed cost, direct materials and direct labour are
variable costs.
When the actual amount is more than the budgeted amount, the variance
is unfavourable; however, when it is lower, it is advantageous.
The static budget report gives an overview of the company's performance
in relation to its budget by comparing the budgeted and actual numbers.
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Answer 5: -
Static Budget of Beal Manufacturing Co.
Number of Units produced = 12,000
Direct Labour = $72,000
Direct Materials = $12,000
Variable Cost per unit for direct labour = $72,000/12000 units = $6 per unit
Variable Cost per unit for direct materials = $12,000/12000 units = $1 per unit
Flexible Budget for Beal Manufacturing Co. for 18,000 units
Direct Labour =$18,000 x 6 = $108,000
Direct Materials =$18,000 x 1 = $18,000
Total Fixed Costs =$48,000
Total Costs =$174,000
Therefore, the flexible budget for Beal Manufacturing Co. for 2022 if 18,000 units
are produced and sold would be $174,000.
