Question

The company is manufacturing and selling TWO models of the branded Laptops:o Model 1

Model 2

Expected number of units to be sold in 2021

Model 1: 30,000 units

 Model 2: 20,000 units

Expected selling Price:
Model 1: $500 per unit

Model 2: $400 per unit

Each model requires 5 components to be finished/produced

Camera (Model 1 has 4 Cameras, while Model 2 has only 2 Cameras).

Keypad
Screen
Frame

Motherboard.

Component purchasing prices are as follows:

Camera: $30

Keypads: $20

Screen: $40

Frame: $6

Motherboard: $24

No ending inventory of any component item (Direct Materials) or finished goods is

required.

each Laptop model requires 5.5 hours of labor at a cost of $10.00 per hour to be manufactured.

Manufacturing Overhead is allocated at a rate of $30 per Direct Labor Hour.

Selling and Admin variable expense rates per unit of sales are sales commissions $3 and freight-out $2

Selling and Admin fixed expenses include Depreciation $8,000 Salaries $2,000 and maintenance $3000 for each model

Interest is $10,000 and Taxes are $50,000 

Required:

Prepare the following for 2021:
Sales Budget
Components (Direct Material Purchases) Budgeto Direct Labor Budget
An overhead Budget
Selling and Administrative Budget

Prepare a budgeted income statement