On January 1, 2014, the Hardin Company budget committee has reached agreement on

Question

On January 1, 2014, the Hardin Company budget committee has reached agreement on the following data for the 6 months ending June 30, 2014. Sales units: First quarter 5,300; second quarter 6,800; third quarter 7,100 Ending raw materials inventory: 40% of the next quarter’s production requirements Ending finished goods inventory: 25% of the next quarter’s expected sales units Third-quarter production: 7,600 units The ending raw materials and finished goods inventories at December 31, 2013, follow the same percentage relationships to production and sales that occur in 2014. 4 pounds of raw materials are required to make each unit of finished goods. Raw materials purchased are expected to cost $5 per pound. Partially correct answer. Your answer is partially correct. Try again. Prepare a production budget by quarters for the 6-month period ended June 30, 2014. HARDIN COMPANY Production Budget For the Six Months Ending June 30, 2014 Quarter 1 2 Six Months Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with correct answer:Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer:Entry field with correct answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer LINK TO TEXT Partially correct answer. Your answer is partially correct. Try again. Prepare a direct materials budget by quarters for the 6-month period ended June 30, 2014. HARDIN COMPANY Direct Materials Budget For the Six Months Ending June 30, 2014 Quarter 1 2 Six Months Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with correct answer:Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer:Entry field with correct answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer $Entry field with incorrect answer $Entry field with incorrect answer Entry field with incorrect answer $Entry field with incorrect answer $Entry field with incorrect answer $Entry field with incorrect answer

Explanation / Answer

Production Budget is calculated as under:

Closing finished inventory is 25% of next quarter sales which is $6,800*25% for 1st quarter and $7,100*25% for 2nd quarter.

Opening finished goods is also calculated on the basis of closing inventory of 1st quarter which will be opening for 2nd quarter and opening inventory of 1st quarter is 25%*5,300

Direct Material Budget is prepared as under:

Quarter I II Amount ($) Amount ($) Sales Units 5,300 6,800 Add: Closing finished inventory 1,700 1,775 Total units 7,000 8,575 Less: Opening inventory 1,325 1,700 Total Production 5,675 6,875

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