E20-2

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

XQ-10320,00025,000

XQ-10412,00015,000

 

No changes in selling prices are anticipated.

Hint: Prepare a sales budget for 2 quarters.

(SO 3)

Instructions

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.

 

E20-5

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

MonthUnitsMonthUnits

January10,000March5,000

February8,000April4,000

 

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.

Instructions

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

 

BE21-4

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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