Best Products Company makes two products, Product A and Product B. They are both made of plastic and metal. Information for the two products for the month of April is given in the following tables:
Best Products accounts for direct materials using a FIFO cost flow assumption.
Pet Luggage uses a FIFO cost flow assumption for finished goods inventory.
Best Products uses an activity-based costing system and classifies overhead into three activity pools:
Setup, Processing and Inspection. Activity rates for these activities are $130 per setup hour, $5 per machine-hour, and $20 per inspection-hour, respectively. Other information follows:
Nonmanufacturing fixed costs for March equal $32,000. The only variable nonmanufacturing costs are sales commission, equal to 1% of sales revenue.
Required:
Prepare the following for April:
1. Revenues budget
2. Production budget in units
3. Direct material usage budget and direct material purchases budget
4. Direct manufacturing labor cost budget
5. Manufacturing overhead cost budgets for each of the three activities
6. Budgeted unit cost of ending finished goods inventory and ending inventories budget
7. Cost of goods sold budget
8. Budgeted income statement (ignore income taxes).