Morganton Company makes one product and it provided thefollowing information to help prepare the master budget:
The budgeted selling price per unit is $70. Budgeted unit salesfor June, July, August, and September are 8,400, 10,000, 12,000,and 13,000 units, respectively. All sales are on credit.
Forty percent of credit sales are collected in the month of thesale and 60% in the following month.
The ending finished goods inventory equals 20% of the followingmonthâs unit sales.
The ending raw materials inventory equals 10% of the followingmonthâs raw materials production needs. Each unit of finished goodsrequires 5 pounds of raw materials. The raw materials cost $2.00per pound.
Thirty percent of raw materials purchases are paid for in themonth of purchase and 70% in the following month.
The direct labor wage rate is $15 per hour. Each unit offinished goods requires two direct labor-hours.
The variable selling and administrative expense per unit sold is$1.80. The fixed selling and administrative expense per month is$60,000.
ASK:
1. What is the estimated finished goods inventory balance at theend of July?
2. What is the estimated net operating income for July?
3. What are the expected cash collections for July?
Morganton Company makes one product and it provided thefollowing information to help prepare the master budget:
The budgeted selling price per unit is $70. Budgeted unit salesfor June, July, August, and September are 8,400, 10,000, 12,000,and 13,000 units, respectively. All sales are on credit.
Forty percent of credit sales are collected in the month of thesale and 60% in the following month.
The ending finished goods inventory equals 20% of the followingmonthâs unit sales.
The ending raw materials inventory equals 10% of the followingmonthâs raw materials production needs. Each unit of finished goodsrequires 5 pounds of raw materials. The raw materials cost $2.00per pound.
Thirty percent of raw materials purchases are paid for in themonth of purchase and 70% in the following month.
The direct labor wage rate is $15 per hour. Each unit offinished goods requires two direct labor-hours.
The variable selling and administrative expense per unit sold is$1.80. The fixed selling and administrative expense per month is$60,000.
ASK:
1. What is the estimated finished goods inventory balance at theend of July?
2. What is the estimated net operating income for July?
3. What are the expected cash collections for July?
Related questions
| [The following information applies to the questionsdisplayed below.] |
Morganton Company makes one product and it provided thefollowing information to help prepare the master budget for itsfirst four months of operations: |
| a. | The budgeted selling price per unit is $65. Budgeted unit salesfor June, July, August, and September are 9,900, 30,000, 32,000,and 33,000 units, respectively. All sales are on credit. |
| b. | Forty percent of credit sales are collected in the month of thesale and 60% in the following month. |
| c. | Theending finished goods inventory equals 30% of the following monthâsunit sales. |
| d. | The ending raw materials inventory equals 20% of the followingmonthâs raw materials production needs. Each unit of finished goodsrequires 4 pounds of raw materials. The raw materials cost $2.50per pound. |
| e. | Forty percent of raw materials purchases are paid for in themonth of purchase and 60% in the following month. |
| f. | The direct labor wage rate is $12 per hour. Each unit offinished goods requires two direct labor-hours. |
| g. | The variable selling and administrative expense per unit sold is$1.90. The fixed selling and administrative expense per month is$69,000. |
Accordingto the production budget, how many units should be produced in Julyand,
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Please show all work , I need to see the stepscalculated out...Thank you!!
Morganton Company makes one product and it provided thefollowing information to help prepare the master budget for itsfour months of operations:
| (a) | The budgeted selling price per unit is $60. Budgeted unit salesfor June, July, August, and September are 9,200, 23,000, 25,000,and 26,000 units, respectively. All sales are on credit. |
| (b) | Thirty-percent ofcredit sales are collected in the month of the sale and 70% in thefollowing month. |
| (c) | The ending finishedgoods inventory equals 20% of the following monthâs unitsales. |
| (d) | The ending raw materials inventory equals 10% of the followingmonthâs raw materials production needs. Each unit of finished goodsrequires 4 pounds of raw materials. The raw materials cost $2.50per pound. |
| (e) | Thirty-percent ofraw materials purchases are paid for in the month of purchase and70% in the following month. |
| (f) | The direct labor wage rate is $13 per hour. Each unit offinished goods requires two direct labor-hours. |
| (g) | The variable selling and administrative expense per unit sold is$1.80. The fixed selling and administrative expense per month is$62,000. |
| If 100,800 poundsof raw materials are needed to meet production in August, how manypounds of raw materials should be purchased in July? |
| Rawmaterials to be purchased | pounds |
