Betz Company’s sales budget shows the following projections for the year ending Dec

Transcribed Image Text: A. Betz Company’s sales budget shows the following projections for the year ending Dec. 31,
2021:
No. of Units
60,000
Quarter
First
Second
80,000
Third
45,000
Fourth
55,000
Inventory at Dec. 31 of last year was budgeted at 18,000 units. The quantity of finished
goods inventory at the end of each quarter should equal 30% of the next quarter’s budgeted sales
of units.
REQUIRED:
1. Prepare the production budget for the first and second quarters separately. Include a total
column.
B. The Charito Company is planning an overhead budget cost for May and June, 20
cost studies indicates that costs have followed behavior patterns as given below:
Past
Variable rate per hour
Indirect materials
PO.90
Heat, light & power
1.20
Repairs & maintenance
Lubrication
4.60
0.50
In addition, management has estimated fixed factory overhead as follows per month:
Supervision
Indirect labor
P44,000
36,000
Heat, light and power
Repairs & maintenance
14,500
17,200
Taxes & insurance
9,000
During May and June, 2021, the company plans to manufacture 150,000 units of
product. Products are produced a the rate of 6 units per hour. Normal plant capacity is 15,000
hours per month. Transcribed Image Text: REQUIRED:
1. Prepare the factory overhead budget for May & June, 2021. Separate the fixed from the
variable cost components.
2. Determine the unused normal capacity, if any.

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