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Scholastic Furniture, Inc

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Scholastic Furniture, Inc. manufactures a variety of desks, chairs, tables, and shelf units that are sold to public school systems throughout the Midwest. The controller of the company's Desk Division is currently preparing a budget for the second quarter of the year. The following sales forecast has been made by the division's sales manager. April May June 10,000 desk-and-chair sets 12,000 desk-and-chair sets 15,000 desk-and-chair sets Each desk-and-chair set requires 10 board feet of pine planks and 1.5 hours of direct labor. Each set sells for $50. Pine planks cost $.50 per board foot, and the division ends each month with enough wood to cover 10 percent of the next month's production requirements. The division incurs a cost of $20 per hour for direct-labor wages and fringe benefits. The division ends each month with enough finished-goods inventory to cover 20 percent of the next month's sales. Required: Complete the following budget schedules. 1. Sales budget. 2. Production budget (in sets). 3. Raw-material purchases. 4. Direct-labor budget.
Required 1 Required 2 Required 3 Required 4 Sales budget: May June April 10,000 Sales (in sets) Sales price per set $ 50 Sales revenue $ 500,000
Required 1 Required 2. Required 3 Required 4 Production budget (in sets): May June Sales April 10,000 2,400 12,400 3,000 Add: Desired ending inventory Total requirements Less: Projected beginning inventory Planned production 2,000 10,400
Required 1 Required 2 Required 3 Required 4 Raw-material purchases: (Round "Cost per board foot" to 2 decimal places.) May June April 10,400 10 104,000 12,600 16,000 Planned production (sets) Raw material required per set (board feet) Raw material required for production (board feet) Add: Desired ending inventory of raw material, in board feet (10% of next month's requirement) Total requirements Less: Projected beginning inventory of raw material, in board feet (10% of current month's requirement) Planned purchases of raw material (board feet) Cost per board foot Planned purchases of raw material (dollars) 116,600 10,400 106,200 $ 0.50 $ 53,100
Required 1 Required 2 Required 3 Required 4 Direct-labor budget: (Round "Direct labor hours per set" to 1 decimal place.) May June April 10,400 1.5 Planned production (sets) Direct-labor hours per set Direct-labor hours required Cost per hour 15,600 $ 20 Planned direct-labor cost $ 312,000