Solved: Slopes Inc manufactures and sells snowboards

Slopes manufacture a single

Slopes Inc manufactures and sells snowboards Slopes manufacture a single

Slopes Inc. manufactures and sells snowboards. Slopes manufacture a single model, the Pipex.
In the summer of 2012, Slopes’s accountant gathered the following data to prepare budgets for
2013. These units are standard in the lumber industry. Wage rate = $25/hr.

Materials and Labour Requirements

Direct materials

Wood ............ 5 board-feet per snowboard

Fibreglass ........... 6 yards per snowboard

Direct labour ........ 5 hours per snowboard

Slopes’s CEO expects to sell 1,200 snowboards during 2013 at an estimated retail price of
$540 per board. Further, she expects 2013 beginning inventory to be 100 boards and would like
to end 2013 with 200 snowboards in stock. The company follows FIFO for inventory flow.

The beginning inventory of wood was purchased at $34 per board foot and fiberglass was
purchased at $5.80 per yard. Prices have now risen to $36 per board foot of wood and $6 per
yard of fibreglass. Variable manufacturing overhead is allocated at the rate of $8.40 per direct
manufacturing labour-hour. Fixed manufacturing overhead costs are budgeted at $78,000 for
2013. Variable marketing costs are allocated at the rate of $300 per sales visit, and the
marketing plan calls for 36 sales visits during 2013. Finally, fixed non-manufacturing costs are
budgeted at $36,000 for 2013.

REQUIRED

Based on the data and projections supplied by Slopes’s managers,

1. Prepare the 2013 revenue budget (in dollars).

2. Prepare the 2013 production budget (in units).

3. Prepare direct materials usage and purchases budgets for 2013.

4. Prepare a direct manufacturing labour budget for 2013.

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 5. Prepare a manufacturing overhead budget for 2013.

6. What is the budgeted manufacturing overhead rate?

7. What is the budgeted manufacturing overhead cost per output unit?

8. Calculate the cost of a snowboard in finished goods inventory at the end of 2013.

9. Prepare an ending inventory budget for 2013.

10. Prepare a cost of goods sold budget for 2013. (Opening finished goods inventory is
$44,976.)

11. Prepare the budgeted income statement for Slopes Inc. for 2013.

Slopes Inc manufactures and sells snowboards Slopes manufacture a single

ANSWER
https://solvedquest.com/slopes-inc-manufactures-and-sells-snowboards-slopes-manufacture-a-
single/

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