Details of this Paper

FreshPak Corporation

Description

solution


Question

FreshPak Corporation manufactures two types of cardboard boxes used in shipping canned food, fruit;and vegetables. The canned food box (type C) and the perishable food box (type P) have the following;material and labor requirements.;Type of Box;C P;Direct material required per 100 boxes;Paperboard ($.20 per pound)......................................................................................... 30 pounds 70 pounds;Corrugating medium ($.10 per pound)........................................................................... 20 pounds 30 pounds;Direct labor required per 100 boxes ($12.00 per hour).........................................................25 hour.50 hour;The following manufacturing-overhead costs are anticipated for the next year. The predetermined;overhead rate is based on a production volume of 495,000 units for each type of box. Manufacturing;overhead is applied on the basis of direct-labor hours.;Indirect material........................................................................................................................................... $ 10,500;Indirect labor............................................................................................................................................... 50,000;Utilities........................................................................................................................................................ 25,000;Property taxes.............................................................................................................................................. 18,000;Insurance.................................................................................................................................................... 16,000;Depreciation................................................................................................................................................ 29,000;Total............................................................................................................................................................ $148,500;The following selling and administrative expenses are anticipated for the next year.;Salaries and fringe benefits of sales personnel................................................................................................... $ 75,000;Advertising..................................................................................................................................................... 15,000;Management salaries and fringe benefits.......................................................................................................... 90,000;Clerical wages and fringe benefits..................................................................................................................... 26,000;Miscellaneous administrative expenses............................................................................................................. 4,000;Total............................................................................................................................................................... $210,000;The sales forecast for the next year is as follows;Sales Volume Sales Price;Box type C......................................................................................... 500,000 boxes $ 90.00 per hundred boxes;Box type P......................................................................................... 500,000 boxes 130.00 per hundred boxes;The following inventory information is available for the next year. The unit production costs for;each product are expected to be the same this year and next year.;Expected Inventory January 1 Desired Ending Inventory December 31;Finished goods;Box type C................................................................................ 10,000 boxes 5,000 boxes;Box type P................................................................................ 20,000 boxes 15,000 boxes;Raw material;Paperboard.............................................................................. 15,000 pounds 5,000 pounds;Corrugating medium................................................................. 5,000 pounds 10,000 pounds;Required: Prepare a master budget for FreshPak Corporation for the next year. Assume an income tax;rate of 40 percent. Include the following schedules.;1. Sales budget.;2. Production budget.;3. Direct-material budget.;4. Direct-labor budget.;5. Manufacturing-overhead budget.;6. Selling and administrative expense budget.;7. Budgeted income statement. (Hint: To determine cost of goods sold, first compute the manufacturing;cost per unit for each type of box. Include applied manufacturing overhead in the cost.);HINTS;1. Total sales revenue;$1,100,000;3. Cost of purchases (paperboard);$97,000;5. Total overhead: $148,500;7. Predetermined overhead;rate: $40 per hour

 

Paper#75097 | Written in 18-Jul-2015

Price : $52
SiteLock