Donnegal Company makes and sells artistic frames for pictures. The controller is
ID: 2451567 • Letter: D
Question
Donnegal Company makes and sells artistic frames for pictures. The controller is responsible for preparing the master budget and has accumulated the following information for 2014.
January
February
March
April
May
Donnegal has a labor contract that calls for a wage increase to $9 per hour on April 1. New labor-saving machinery has been installed and will be fully operational by March 1.
Donnegal expects to begin the year with 17,600 frames on hand and has a policy of carrying an end-of-month inventory of 100% of the following month’s sales, plus 40% of the second following month’s sales.
January
February
March
April
May
Estimated unit sales 12,000 14,000 10,000 11,000 11,000 Sales price per unit $50.00 $47.50 $47.50 $47.50 $47.50 Direct labor hours per unit 2.00 2.00 1.50 1.50 1.50 Wage per direct labor hour $8 $8 $8 $9 $9 (a) Your answer is partially correct. Try again Prepare a production budget for Donnegal Company by month and for the first quarter of the year DONNEGAL COMPANY Production Budget For the Quarter Ending March 31, 2014 Jan Feb Mar Sales in Units 12,000 14,000 10,000 Add # LT Desired Ending Inventory 14,000 10,000 11,000 Sales in Units 4000 4,400 10,000 LessBeginning Inventory 17,600 14,000 10,000 Production Needed 12,400 14,400 15,400 Click if you would like to Show Work for this question: Open Show WorkExplanation / Answer
Donnegal Company makes and sells artistic frames for pictures. The controller is
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