1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Amanda [17]
2 years ago
13

EcoSacks manufactures cloth shopping bags. The controller is preparing a budget for the coming year and asks for your assistance

. The following costs and other data apply to bag production:
Direct materials per bag 1.0 yard cotton at $4 per yard 0.2 yards canvas finish at $12 per yard Direct labor per bag 0.5 hour at $18 per hour Overhead per bag Total overhead per unit $3.40

You learn that equipment costs and building occupancy are fixed and are based on a normal production of 600,000 units per year. Other overhead costs are variable. Plant capacity is sufficient to produce 750,000 units per year.

Labor costs per hour are not expected to change during the year. However, the cotton supplier has informed EcoSacks that it will impose a 20 percent price increase at the start of the coming budget period. No other costs are expected to change.

During the coming budget period, EcoSacks expects to sell 540,000 bags. Finished goods inventory is targeted to increase from the current balance of 120,000 units to 210,000 units to prepare for an expected sales increase the year after next as a result of legislation in several states regarding plastic bags. Production will occur evenly throughout the year. Inventory levels for cotton and canvas are expected to remain unchanged throughout the year. There is no work-in-process inventory.

Required

Prepare a production budget and estimate the materials, labor, and overhead costs for the coming year.
Business
2 answers:
Sidana [21]2 years ago
8 0

Answer:

ECOSACKS

Production  Budget

Sales                               540,000

closing inventory(FG)   <u>  210,000</u>

                                        750,000

Opening Inventory(FG)  <u>( 120,000)</u>

Production                         <u>630,000</u>

<u />

<u>Materials Purchase budget </u>

                                          cotton                    canvas

                                              yards                   yards

Material usage                 <u>630,000</u>                  <u>126,000</u>

Material purchase cost    $2,520,000            $1,512,000

                                 <u>      Labor Budget </u>

labor hour(630,000*0.5)         <u> 315,000</u>

Labour cost (315,000*18)       <u>$5,670,000</u>

<u />

<u>                                        Overhead budget</u>

Production unit                                630,000

Overhead cost ( 630,000*$3.40)      <u>$2,142,000</u>

Explanation:

GrogVix [38]2 years ago
6 0

Answer:

A.

Full Year production plan = 630,000

And Monthly production = 630,000 / 12 = 52,500 units

B.

Total Material costs = $4,536,000

C.

Total Labor Costs = $5,670,000

D.

Overheads = $2,142,000

Explanation:

Ecosacks

Production plan

Opening Stock = 120,000

Planned sales volume = 540,000

Therefore production required to cover sales = sales plan minus Opening stock = 420,000 units

Expected closing stock = 210,000

We will have to produce additional 210,000 units to achieve this closing stock

= 420,000 + 210,000 = 630,000 units.

Production is expected to stay even all year through;

This implies monthly production = 630,000 / 12 = 52,500 units

B.

Material costs.

Cotton: 1 yard makes 1 bag and it is priced at 20% higher from last year ($4 x 120%) per yard

Cotton costs = 630,000units x 1yd x ($4 x 120%) = $3,024,000

Canvas Finish: 0.2 yard required for 1 bag and it is priced at $12 per yard

Canvas finish cost = 630,000 x 0.2 x 12 = $1,512,000

Total Material costs = $4,536,000

C.

Labor costs = 0.5hr per bag and it costs $18 per hour

Labour costs = 0.5 x 18 x 630,000

= $5,670,000

D.

Overhead costs = $3.40 x 630,000 = $2,142,000

You might be interested in
Across mass marketing, niche marketing, and one-to-one marketing, the underlying method of dealing with heterogeneity is the sam
katovenus [111]

Across mass marketing, niche marketing, and one-to-one marketing, the underlying method of dealing with heterogeneity is the same: focus on smaller group such that the needs of each group are similar until the focus reaches individual customer.

<h3>What is the mass marketing?</h3>

Mass marketing is used to refer to the type of marketing that is done on a large scale. In this type of marketing, the producers would have to ignore the segments that may exist in the market.

Hence they would have to market the product to the entire market so that it gets to a larger audience hence it may bring about a greater market for the producer.

Read more on marketing here: brainly.com/question/25369230

#SPJ1

5 0
1 year ago
What are yeezys made out of?
REY [17]
Feminist's tears........
7 0
3 years ago
Read 2 more answers
The "market clearing price" is most closely associated with
mel-nik [20]

The market clearing price is the price that balances the amount buyers want to buy with the amount sellers want to sell. This price balances the amounts demanded and supplied. The "market clearing price" is most closely associated with market equilibrium, because it exists when a market is clear of shortage and surplus, or is in equilibrium, when the demand curve and supply curve intersect.

4 0
3 years ago
Read 2 more answers
​psychologists usually attempt to determine whether or not data supports a hypothesis through the use of ____.
guajiro [1.7K]
Psychologists usually attempt to determine whether or not data supports a hypothesis through the use of statistics which means gathering/collecting all data facts and important information.
6 0
3 years ago
a type of long term permanent financing for residential construction or large construction projects, that replaces the construct
shepuryov [24]

A type of long term permanent financing for residential construction or large construction projects, that replaces the construction loan is called a takeout loan.

<h3>What is a takeout loan?</h3>

A takeout loan is a method of financing whereby a loan that is procured later is used to replace the initial loan.

More specifically, a takeout loan, or takeout financing, is long-term financing that the lender promises to provide at a particular date or when particular criteria for completion of a project are met.

A take-out loan provides a long-term mortgage or loan on a property that "takes out" an existing loan.

The take-out loan will replace interim financing, such as replacing a construction loan with a fixed-term mortgage.

If the take-out loan is used to finance a rental or income-generating property, the take-out lender may be entitled to a portion of the rents earned.

To learn more about take-out loan, refer

brainly.com/question/1415802

#SPJ4

5 0
10 months ago
Other questions:
  • BarkBark Inc. and Happy Toys Ltd. are considering a merger and are worried that their two organizational cultures will clash. Th
    11·1 answer
  • All of the following cost would be found on a company’s accounting records except
    11·1 answer
  • Star, inc., is attempting to decide whether or not if it should change its manufacturing process to a new type of technology. th
    5·1 answer
  • A favorable direct materials cost variance occurs when the actual direct
    10·1 answer
  • Cole has a cold. Although the brand-name drug is more expensive than the generic, he buys the brand-name one. Cole is familiar w
    6·1 answer
  • Which of the following is a valid interpretation of Say's law?
    5·1 answer
  • What is the median of this<br> data?<br> 3, 4, 7, 6, 1
    9·2 answers
  • Walmart is the biggest seller of raw chicken to the top 10 fast food chains in the United States. Walmart
    11·2 answers
  • Which communication theory is most relevant to a speaker developing a persuasive speech?
    11·1 answer
  • An individual who achieves ___ through other people by the use of organizational power is a manager.
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!