Budgeted Income Statement and Supporting Budgets The budget director of Gold Med

Question

Budgeted Income Statement and Supporting Budgets

The budget director of Gold Medal Athletic Co., with the assistance of the controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income statement for March:

Estimated sales for March:

Estimated inventories at March 1:

Desired inventories at March 31:

Direct materials used in production:

Anticipated cost of purchases and beginning and ending inventory of direct materials:

Direct labor requirements:

Estimated factory overhead costs for March:

Estimated operating expenses for March:

Estimated other income and expense for March:

Estimated tax rate: 30%

Required:

1. Prepare a sales budget for March. Enter all amounts as positive numbers.

2. Prepare a production budget for March. For those boxes in which you must enter subtracted or negative numbers use a minus sign.

3. Prepare a direct materials purchases budget for March. For those boxes in which you must enter subtracted or negative numbers use a minus sign.

4. Prepare a direct labor cost budget for March. Enter all amounts as positive numbers.

5. Prepare a factory overhead cost budget for March.

6. Prepare a cost of goods sold budget for March. Work in process at the beginning of March is estimated to be $15,300, and work in process at the end of March is desired to be $14,800. For those boxes in which you must enter subtracted or negative numbers use a minus sign.

7. Prepare a selling and administrative expenses budget for March.

8. Prepare a budgeted income statement for March.

Batting helmet 1,200 units at $40 per unit Football helmet 6,500 units at $160 per unit

Explanation / Answer

1) Gold Medal Athletic Co.

Sales Budget for the month ending March 31 (Amounts in $)

2)   Gold Medal Athletic Co.
Production Budget
For the Month Ending March 31 (in units)

3)   Gold Medal Athletic Co.
Direct Materials Purchases Budget
For the Month Ending March 31

4) Gold Medal Athletic Co.
Direct Labor Cost Budget
For the Month Ending March 31

Particulars Units Sales Volume (A) Units Selling Price (B) Total Sales (A*B) Batting helmet 1,200 units $40 per unit 48,000 Football helmet 6,500 units $160 per unit 1,040,000 Total Sales Revenue 1,088,000

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