Petrini Corporation Makes One Product and It Provided the Following

question 160

Multiple Choice

Petrini Corporation makes one product and it provided the following information to help prepare the master budget for the next four months of operations:The budgeted selling price per unit is $110. Budgeted unit sales for January, February, March, and April are 7,500, 10,600, 12,000, and 11,700 units, respectively. All sales are on credit.Regarding credit sales, 30% are collected in the month of the sale and 70% in the following month.The ending finished goods inventory equals 30% of the following month's sales.The ending raw materials inventory equals 10% of the following month's raw materials production needs. Each unit of finished goods requires 5 pounds of raw materials. The raw materials cost $4.00 per pound.Regarding raw materials purchases, 40% are paid for in the month of purchase and 60% in the following month.The direct labor wage rate is $23.00 per hour. Each unit of finished goods requires 2.6 direct labor-hours.Manufacturing overhead is entirely variable and is $8.00 per direct labor-hour.The variable selling and administrative expense per unit sold is $1.70. The fixed selling and administrative expense per month is $70,000.The budgeted sales for February is closest to:

• A) $825,000
• B) $1,166,000
• C) $1,287,000
• D) $1,320,000

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Definitions:

Osteoporosis

A condition characterized by reduced bone density and quality, leading to weakened bones and an increased risk of fractures.

Calcium Supplements

Products or substances taken to increase calcium intake, essential for bone health and various metabolic functions in the body.

Ligaments

Tough, fibrous connective tissues that connect bones to other bones, providing joint stability.

Tendons

Fibrous connective tissues that attach muscles to bones, transferring the force of muscle contractions to bones to facilitate movement.