The board of directors Notes

  • The board of directors of Midwest Manufacturing Company recently approved the company’s budget and production plan for its coming fiscal year

    [http://assignment.store/the-board-of-directors-of-midwest-manufacturing-company-recently-approved-the-companys-budget-and-production-plan-for-its-coming-fiscal-year/](http://assignment.store/the-board-of-directors-of-midwest-manufacturing-company-recently-approved-the-companys-budget-and-production-plan-for-its-coming-fiscal-year/)\n\nThe board of directors of Midwest Manufacturing Company recently approved the company’s budget and\n\nproduction plan for its coming fiscal year, 20X6. Budgeted units of production equal budgeted unit sales for the\n\ncompany’s single product. Using the information below, included in the budget and production plan:\n\na. Compute the amount of required sales – number of units and dollars – necessary to achieve the company’s\n\nbudgeted net income for its fiscal year ended (FYE) December 31, 20X6\n\nb. Prepare the company’s budgeted income statement for its FYE December 31, 20X6 using the Variable\n\nCosting Method (Contribution Margin Format).\n\nShow all computations in good form and label properly all amounts presented. Budgeted amounts: Budgeted amounts: Sales units ? Product selling price (SP) Sales dollars ? Variable manufacturing costs: Fixed costs: Per\n\nunit\n\n$350.0\n\n0 Direct materials (DM) $78.75 Manufacturing overhead\n\n(MOH) costs $5,250,\n\n000 Direct labor (DL) $66.25 Selling and administrative\n\n(S&A) costs $5,625,\n\n000 Manufacturing overhead (MOH)\n\ncosts $92.50 Research and development\n\n(R&D) costs $3,750, Variable selling and admin. (S&A)\n\n000 costs Net income $4,725, Estimated combined\n\n000 effective tax rate $37.50 40.0% (i.e.,\n\n0.40) 2 a. Amount of required sales – number of units and dollars – necessary to achieve the company’s budgeted\n\nnet income for its fiscal year ended (FYE) December 31, 20X6: b. Prepare the company’s budgeted income statement for its FYE December 31, 20X6 using the Variable\n\nCosting Method (Contribution Margin Format) Midwest Manufacturing Company\n\nBudgeted Income Statement\n\nFiscal year ended December 31, 20X6\n\nUnits:\n\nSales Per unit: Total: $ $ Variable expenses:\n\nCost of goods sold $\n\n$ Total variable expenses $\n\n$ $ 3 Topic 2 (25 points)\n\nThe board of directors of Jupiter Manufacturing Company recently approved the company’s budget and\n\nproduction plan for its coming fiscal year (FY). The company manufactures two products – door latches and\n\ndoor hinges – from a single plant that comprises four activities – machine setup, fabrication, assembly, and\n\nplant administration. The company uses the same resources (including machinery and equipment, supervision\n\nand administrative services) to manufacture both products. Management uses the traditional approach to\n\nallocate manufacturing overhead (MOH) costs, based on direct labor hours (DLH) incurred in its two production\n\ndepartments, to determine the unit cost of each product. The company’s budget includes the following MOH\n\nallocation and related computations:\n\nPer unit: Door\n\nlatches Selling price (SP) Door\n\nhinges $24.75 $11.98 $ 7.20 $ 2.90 Direct labor (DL) 7.50 5.00 MOH (A) x (B) 3.87 2.58 $18.57 $10.48 Gross profit (GP) $ 6.18 $ 1.50 Gross margin (GM) GM = GP / SP (see Note 1 below) 25.0% 12.5% Budgeted total units of production for fiscal year (FY) 75,000 225,000 Budgeted batch size (units per batch) 300 1,500 (A) Direct labor hours (DLH) per unit 0.30 0.20 Product costs:\n\nDirect material (DM) Total (B) MOH cost per direct labor hour (DLH) (\n\nC) $12.9\n\n0 (\n\nC


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