Problem 23-2A Deleon Inc. is preparing its annual budgets for the year ending De
ID: 2478908 • Letter: P
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Problem 23-2A Deleon Inc. is preparing its annual budgets for the year ending December 31, 2017. Accounting assistants furnish the data shown below Product Product B 50 JB 60 Sales budget Anticipated volume in units Unit selling price 403,900201,200 $28 $23 Production budget: Desired ending finished goods units Beginning finished goods units 26,400 32,900 16,700 12,600 Direct materials budget: Direct materials per unit (pounds) Desired ending direct materials pounds Beginning direct materials pounds Cost per pound 2 33,900 42,700 $2 18,900 11,000 $3 Direct labor budget: Direct labor time per unit Direct labor rate per hour 0.4 $11 0.6 $11 Budgeted income statement: Total unit cost $14 $21 An accounting assistant has prepared the detailed manufacturing overhead budget and the selling and administrative expense budget. The latter shows selling expenses of $665,000 for product JB 50 and $363,000 for product JB 60, and administrative expenses of $544,000 for product JB 50 and $341,000 for product JB 60. Interest expense is $150,000 (not allocated to products). Income taxes are expected to be 30%Explanation / Answer
Deleton Inc. Sales Budget For the Year Ended Dec 31, 2017 Product JB 50 Product JB 60 Total Expected Unit Sales 403,900 201,200 Unit Selling price 23 28 Total Sales 9,289,700 5,633,600 14,923,300 Deleton Inc. Production Budget For the Year Ended Dec 31, 2017 Product JB 50 Product JB 60 Expected Unit Sales 403,900 201,200 Add: Desired Ending Finished Goods 26,400 16,700 Total Needs 430,300 217,900 Less: Beginning Finished Goods (32,900) (12,600) Total Unit to be Produced 397,400 205,300
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