Reference no: EM13342954

The budget director of Outdoor Gourmet Grill Company requests estimates of sales, production, and other operating data from the various administrative units every month. Selected information concerning sales and production for July 2010 is summa¬rized as follows:

a. Estimated sales for July by sales territory:

Maine:

Backyard Chef 5,000 units at $750 per unit
Master Chef 1,800 units at $1,500 per unit

Vermont:
Backyard Chef 4,200 units at $800 per unit
Master Chef 1,600 units at $1,600 per unit

New Hampshire:

Backyard Chef 4,600 units at $850 per unit
Master Chef 1,900 units at $1,700 per unit

b. Estimated inventories at July 1:

Direct materials:
Grates 1,000 units
Stainless steel 1,800 lbs.
Burner subassemblies 500 units
Shelves 300 units Finished products:
Backyard Chef 1,400 units
Master Chef 600 units

c. Desired inventories at July 31:
Direct materials: Finished products:
Grates 800 units Backyard Chef 1,600 units
Stainless steel 2,100 lbs. Master Chef 500 units
Burner subassemblies 550 units
Shelves 350 units

d. Direct materials used in production:
In manufacture of Backyard Chef:
Grates 3 units per unit of product
Stainless steel 20 lbs. per unit of product
Burner subassemblies 2 units per unit of product
Shelves 5 units per unit of product
In manufacture of Master Chef:
Grates 6 units per unit of product
Stainless steel 45 lbs. per unit of product
Burner subassemblies 4 units per unit of product
Shelves 6 units per unit of product

e. Anticipated purchase price for direct materials:
Grates $20 per unit Burner subassemblies $105 per unit
Stainless steel $6 per lb. Shelves $7 per unit

f. Direct labor requirements:
Backyard Chef:
Stamping Department 0.60 hr. at $18 per hr.
Forming Department 0.80 hr. at $14 per hr.
Assembly Department 1.50 hr. at $12 per hr.

Master Chef:
Stamping Department 0.80 hr. at $18 per hr.
Forming Department 1.50 hr. at $14 per hr.
Assembly Department 2.50 hr. at $12 per hr.

Instructions

1. Prepare a sales budget for July.
2. Prepare a production budget for July.
3. Prepare a direct materials purchases budget for July.
4. Prepare a direct labor cost budget for July.

PR 22-1B

Direct materials and direct labor variance analysis Vintage Dresses Inc. manufactures dresses in a small manufacturing facility.

Manufacturing has 20 employees. Each employee presently provides 35 hours of pro-ductive labor per week. Information about a production week is as follows:

Instructions:

Determine (a) the standard cost per dress for direct materials and ,direct labor; (b) the priceVariance, quantit ariance, and total direct matd4als cost variance; and (c) the rate \ypi, fiance, time' v, lance, and total dire,Sbor cost variance.