Zeller Electronics Inc. produces and sells two models of pocket calculators, XQ-103 and XQ-104. The calculators sell for $12 and $25, respectively. Because of the intense competition Zeller faces, management budgets sales semiannually. Its projections for the first 2 quarters of 2010 are as follows.

Unit Sales

ProductQuarter 1Quarter 2




No changes in selling prices are anticipated.

Hint: Prepare a sales budget for 2 quarters.

(SO 3)


Prepare a sales budget for the 2 quarters ending June 30, 2010. List the products and show for each quarter and for the 6 months, units, selling price, and total sales by product and in total.



Moreno Industries has adopted the following production budget for the first 4 months of 2011.





Each unit requires 3 pounds of raw materials costing $2 per pound. On December 31, 2010, the ending raw materials inventory was 9,000 pounds. Management wants to have a raw materials inventory at the end of the month equal to 30% of next month's production requirements.

Hint: Prepare a direct materials purchases budget.


Prepare a direct materials purchases budget by month for the first quarter.



Hannon Company expects to produce 1,225320 units of Product XX in 2010. Monthly production is expected to range from 74340 to 113960 units. Budgeted variable manufacturing costs per unit are: direct materials $3, direct labor $6, and overhead $9. Budgeted fixed manufacturing costs per unit for depreciation are $5 and for supervision are $1. Prepare a flexible manufacturing budget for the relevant range value using 19810 unit increments.

Hint: Prepare a flexible budget for variable costs.


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