Answer:
The total budgeted cost of units produced $1,425,000
Explanation:
Total unit cost includes all the manufacturing costs like material, labor and overhead. It is used to calculating the inventory value.
As there is no beginning and ending inventory of work in process. The given beginning and ending inventory is Finished goods inventory.
Beginning Inventory = 16,000 units x $4.75 per unit = $76,000
Total Budgeted cost =
Unit produced = 300,000 units
Cost of Goods sold Budget
Direct material $501,000
Direct labor $168,000
Variable overhead $216,000
Fixed overhead <u>$540,000</u>
Total Manufacturing cost $1,425,000
Add: Beginning Finished goods inventory $76,000
Less: Ending Finished goods inventory <u>$147,250 </u>
Cost of Goods Sold <u>$1,353,750</u>
Workings:
Direct material = $1.67 x 300,000 units = $501,000
Direct labor = $0.56 x 300,000 units = $168,000
Variable overhead = $0.72 x 300,000 units = $216,000
Fixed overhead = $1.80 x 300,000 units = $540,000
Total Budgeted cost = $501,000 + $168,000 + $216,000 + $540,000 = 1,425,000
Ending Finished goods inventory = Beginning Finished goods inventory + Production in the period - Sales in the period = 16,000 + 300,000 - 285,000 = 31,000 units
Value of Ending Finished goods inventory = 31,000 units x 4.75 = $147,250
