Ch 22 - Budgeting ProblemNancy Inc. has the following data to prepare budgets for 2023:Budgeted Sales units: 1st Qtr 8,000; 2nd Qtr 8,500; 3rd Qtr 9,000, 4th Qtr 9,500Selling price per unit is $35Desired Ending Finished Goods Inventory: 18% of next Qtr SalesDesired Ending Raw Material Inventory: 23% of next Qtr ProductionBeginning Inventory Balances for Production and Material follow the same percentage relationshipsEach unit requires 2 pounds of material, at $5 per poundEach unit requires 1.5 hours of labor, at $10 an hourAnswer the following questions based on the data above:Compute the Sales Budget for the 4 Quarters, and total for the yearCompute the Production Units Required for Qtr 1 and Qtr 2Compute the total pounds of Direct Material Purchases required for Qtr 1 and Qtr 2Compute the total cost of Direct Material Purchases required for Qtr 1 and Qtr 2Compute the total cost of Direct Labor required for Qtr 1 and Qtr 2Show all calculations for each item step-by-step

The objective of this question is to prepare various budgets for Nancy Inc. for the year 2023. The…

Answered: Ch 22 - Budgeting Problem Nancy Inc.…

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter7: The Master Budget And Flexible Budgeting

Section: Chapter Questions

Problem 2P: Sales, production, direct materials, direct labor, and factory overhead budgets King Tire Co.s...

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Ch 22 - Budgeting Problem

Nancy Inc. has the following data to prepare budgets for 2023:

Budgeted Sales units: 1st Qtr 8,000; 2nd Qtr 8,500; 3rd Qtr 9,000, 4th Qtr 9,500
Selling price per unit is $35
Desired Ending Finished Goods Inventory: 18% of next Qtr Sales
Desired Ending Raw Material Inventory: 23% of next Qtr Production
Beginning Inventory Balances for Production and Material follow the same percentage relationships
Each unit requires 2 pounds of material, at $5 per pound
Each unit requires 1.5 hours of labor, at $10 an hour

Answer the following questions based on the data above:

Compute the Sales Budget for the 4 Quarters, and total for the year
Compute the Production Units Required for Qtr 1 and Qtr 2
Compute the total pounds of Direct Material Purchases required for Qtr 1 and Qtr 2
Compute the total cost of Direct Material Purchases required for Qtr 1 and Qtr 2
Compute the total cost of Direct Labor required for Qtr 1 and Qtr 2

Show all calculations for each item step-by-step

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