The document presents budgets for sales, production, materials, labor, and overhead for two products - Light Coil and Heavy Coil - produced by a company. The sales budget shows total expected revenue of $7.7 million from sales of 60,000 Light Coils at $65 each and 40,000 Heavy Coils at $95 each. The production budget calculates the number of units that need to be produced for each product based on expected sales and starting/ending finished goods inventory. The materials, labor, and overhead budgets calculate the expected costs for materials, direct labor hours and wages, and overhead expenses including purchase costs, depreciation, shipping, and general manufacturing overhead.

1. Problem: 9-40.
Page no: 388 - 389
1. Sales Budget
Products
Light Coil
Heavy Coil
Unit sold
X Selling Price
60,000
65
40,000
95
Total Sales revenue
3,900,000
3,800,000
7,700,000/=
2. Production Budget
Products
Light Coil
Heavy Coil
Unit sold
+ FG at End
- FG at Start
60,000
25,000
(20,000)
40,000
9,000
(8,000)
Units to be produced
65,000/=
41,000/=
3. Material Usage
Products
Light Coil
Heavy Coil
Material Usage
Unit Produced
Sheet Metal
Copper Wire
Platforms
65,000
260,000
130,000
---------
41,000
205,000
123,000
41,000
465,000
253,000
41,000
4. Material Purchase Budget
Products
Sheet Metal
Copper Wire
Platforms
Material Usage
+ Material at End
- Material at Start
465,000
36,000
(32,000)
253,000
32,000
(29,000)
41,000
7,000
(6,000)
Material usage (QTY)
X Purchase Price
469,000
8
256,000
5
42,000
3
Purchase Price Budget
3,752,000/=
1,280,000/=
126,000/=
5. Direct – Labor Budget

2. Products
Units
Produced X
Unit Per Hour
Total Hour
=
Rate Per Hour
X
Direct Labor
Cost
Light Coil
65,000
2
130,000
15
1,950,000
Heavy Coil
41,000
3
123,000
20
2,460,000
253,000/=
4,410,000/=
6. Overhead Budget
Purchase and Handling
(469,000 + 256,000) X 0.25
= 181,250
Depreciation
(65,000 + 41,000) X 4
= 424,000
Shipping
(60,000 + 40,000) X 1
= 100,000
General manufacturing Overhead
(253,000 X 3)
= 759,000
Total FOH
1,464,250/=