Petrini Corporation Makes One Product and It Provided the Following

question 3

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:
a. 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.
b. Regarding credit sales, 30% are collected in the month of the sale and 70% in the following month.
c. The ending finished goods inventory equals 30% of the following month's sales.
d. 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.
e. Regarding raw materials purchases, 40% are paid for in the month of purchase and 60% in the following month.
f. The direct labor wage rate is $23.00 per hour. Each unit of finished goods requires 2.6 direct labor-hours.
g. Manufacturing overhead is entirely variable and is $8.00 per direct labor-hour.
h. The variable selling and administrative expense per unit sold is $1.70. The fixed selling and administrative expense per month is $70,000.
-The estimated direct labor cost for February is closest to:

• A) $253,460
• B) $456,000
• C) $658,996
• D) $28,652

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Definitions:

Inclusion

Is the degree to which an organization’s culture respects and values diversity.

Affection

A feeling of fondness or tenderness towards someone or something; it represents warmth and care.

Social Demands

The expected norms and behaviors that society imposes on individuals or organizations.

Ego Involvement

The degree to which a person identifies personally with a task or issue, affecting their attitudes and behaviors.