inventory
Chpater 6
value:
10.00 points
Foundational 7-1
| Morganton Company makes one product and it provided the following information to help prepare the master budget for its four months of operations: |
| (a) | The budgeted selling price per unit is $65. Budgeted unit sales for June, July, August, and September are 8,400, 15,000, 17,000, and 18,000 units, respectively. All sales are on credit. |
| (b) | Thirty-percent of credit sales are collected in the month of the sale and 70% in the following month. |
| (c) | The ending finished goods inventory equals 30% of the following month’s unit sales. |
| (d) | The ending raw materials inventory equals 20% of the following month’s raw materials production needs. Each unit of finished goods requires 5 pounds of raw materials. The raw materials cost $2.50 per pound. |
| (e) | Thirty-percent of raw materials purchases are paid for in the month of purchase and 70% in the following month. |
| (f) | The direct labor wage rate is $12 per hour. Each unit of finished goods requires two direct labor-hours. |
| (g) | The variable selling and administrative expense per unit sold is $1.60. The fixed selling and administrative expense per month is $65,000. |
| What are the budgeted sales for July? |
| Budgeted sales | $ [removed] |
2.
value:
10.00 points
Foundational 7-2
| Morganton Company makes one product and it provided the following information to help prepare the master budget for its four months of operations: |
| (a) | The budgeted selling price per unit is $65. Budgeted unit sales for June, July, August, and September are 9,900, 30,000, 32,000, and 33,000 units, respectively. All sales are on credit. |
| (b) | Forty-percent of credit sales are collected in the month of the sale and 60% in the following month. |
| (c) | The ending finished goods inventory equals 30% of the following month’s unit sales. |
| (d) | The ending raw materials inventory equals 20% of the following month’s raw materials production needs. Each unit of finished goods requires 4 pounds of raw materials. The raw materials cost $2.50 per pound. |
| (e) | Forty-percent of raw materials purchases are paid for in the month of purchase and 60% in the following month. |
| (f) | The direct labor wage rate is $12 per hour. Each unit of finished goods requires two direct labor-hours. |
| (g) | The variable selling and administrative expense per unit sold is $1.90. The fixed selling and administrative expense per month is $69,000. |
| What are the expected cash collections for July? |
| Total cash collections | $ [removed] |
3.
value:
10.00 points
Foundational 7-3
| Morganton Company makes one product and it provided the following information to help prepare the master budget for its four months of operations: |
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