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hichkok12 [17]
3 years ago
6

Qs 20-13 manufacturing: direct materials budget lo p1 miami solar manufactures solar panels for industrial use. the company budg

ets production of 5,000 units (solar panels) in july and 5,300 units in august. each unit requires 3 pounds of direct materials, which cost $6 per pound. the companyâs policy is to maintain direct materials inventory equal to 30% of the next monthâs direct materials requirement. as of june 30, the company has 4,500 pounds of direct materials in inventory, which complies with the policy. prepare a direct materials budget for july.
Business
1 answer:
Helen [10]3 years ago
7 0

Calculation of Direct Material Budget for the month of July:

Budgeted production (Units) for July 5,000

Material required per unit (pounds) 3

Material requirement for July (pounds) = (5000 units * 3 pounds) 15,000

Add: Ending material inventory (5300 units * 3 pounds* 30%) 4,770

Less: Beginning material inventory 4,500

Direct Material Purchase (Pounds) (15000+4770-4500) = 15,270

Cost per pound of Metrial ($) $6.00

Direct Material Purchase ($) (15270 pounds * $6) = $91,620

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Answer:

case 1: when $405,000 fixed overhead cost can be avoided

make buy net income

direct material

994700 0 994700

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total 2528500 2509200 19300

YES,jobs should accept the offer because it results in saving of $19300

CASE 2: when no fixed overhead can be avoided

make buy net income

direct material 994700 0 994700

direct labour 832300 0 832300

variable overhead 101500 0 101500

fixed overhead 600000 600000 0

opportunity cost 375000 0 375000

purchase price 0 2314200 (2314200)

total cost 2903500 2914200 (10700)

NO, jobs shold not accept the offer because it results in loss of $10700

4 0
2 years ago
If the Market Equilibrium Wage Rate is $105.00 and FC = $1500.00: A. The firm Shuts Down and hires no workers and loses $1500.00
BartSMP [9]

Answer: B. The firm hires 45 workers and earns a $1,200.00 Economic Profit

Explanation:

If the Market Equilibrium rate is $105 then the company should hire 45 workers as shown in the table.

If they did that, revenue would be $7,425

Expenses would be wages and fixed costs:

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= (45 workers * wage rate) + 1,500

= (45 * 105) + 1,500

= $6,225

Economic profit would be:

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6 0
3 years ago
The starting point for preparing the operating activities section using the indirect method is ______. Multiple choice question.
vitfil [10]

Net income serves as the beginning point for the indirect technique of preparing the operating activities section.

<h3>What does "net income" mean?</h3>

Net income is the amount of money left over after all costs, such as salaries and wages, the cost of commodities or raw materials, and taxes, have been paid. Net income is the amount that a person keeps after paying taxes, health insurance premiums, and retirement contributions.

<h3>How is net income demonstrated?</h3>

Operating income for the business was $23,000 after operating costs of $12,500. After deducting interest expense of $1,500 and adding interest income of $1,700, ABYZ arrived at a net income before taxes of $23,200.

<h3>What is net income post-tax?</h3>

A person's income after taxes and deductions is referred to as their net income.

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5 0
2 years ago
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<u>Solution:</u>

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Answer:

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5 0
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