Annual sales 42000 30000
Material A 2.0 pounds 1.0 pound
Material B 1.5 pounds 0.8 pounds
Direct labor 0.3 hours 0.2 hour
Overhead is applied at a rate of $1.60 per direct labor hour.
Expected Beginning Inventories Desired Ending Inventories
Material A 1780 pounds 1500 pounds
Material B 5000 pounds 1400 pounds
Boxes 1200 units 1800 units
Trays 800 units 650 units Material A costs $0.05 per pound and Material B costs $0.07 per pound. Prepare the
following information: a. Production schedule by product and in total. b. Purchases budget in units by raw material in total and in dollars. c. Direct labor budget in hours by product in total and in dollars. Th e average direct
labor wage rate is $9.50 per hour. d. Overhead to be charged to production by product and in total.