Shadee Corp. expects to sell 520 sun visors in May and 420 in June. Each visor s

Question

Shadee Corp. expects to sell 520 sun visors in May and 420 in June. Each visor sells for $15. Shadee’s beginning and ending finished goods inventories for May are 85 and 50 units, respectively. Ending finished goods inventory for June will be 60 units.

Chapter 8 Homeworkx ezto.mheducation.com/hm.tpx?-0.25826883566 196046 1520290721538 velue Required Infometion 3.00 points E8-8 Preparing Cost of Goods Sold Budget [LO 8-3f Each visor requires a total of $3.50 in diroct matorials that includos an adjustable closure that the company purchasos from a supplier at a cost of $2.00 each. Shadee wants to have 30 closuros on hand on May 1, 19 closures on May 31, and 25 closures on June 30 and variable manufacturing averhead is $1.00 per unit produced. Suppose that each visar takes 0.30 direct labor hours to produce and Shadee pays its workers $7 per hour Required: 1. Determine Shadee's budgeted manufacturing cost per visor.Note: Assume that fixed overhead per unit is S 1.60.)(Round your answer to 2 decimal places.) g Cost per Unit 2. Compute the Shadoe's budgeted cost of goods sold for May and June. (Do not round your intermediate values. Use rounded cost per unit in intermediate calculations.) May June Budgeted Cost of Goods Sold References Worksheet Difficulty: 2 Medium

Explanation / Answer

1.

Direct material (inc. closure)

$       3.50

Add: Dire ct labor (0.3 x $ 7)

$       2.10

Add: Variable manufacturing overhead

$       1.00

Add: Fixed manufacturing overhead

$       1.80

Total manufacturing cost per unit

$       8.40

2.

May

June

Number of Budgeted Sales Units

520

420

x Cost of Goods sold per unit

$            8.40

$            8.40

Budgeted Cost of Goods sold

$          4,368

$          3,528

Direct material (inc. closure)

$       3.50

Add: Dire ct labor (0.3 x $ 7)

$       2.10

Add: Variable manufacturing overhead

$       1.00

Add: Fixed manufacturing overhead

$       1.80

Total manufacturing cost per unit

$       8.40

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