Petrini Corporation Makes One Product and It Provided the Following

question 159

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 net operating income (loss) for February is closest to:

• A) $11,620
• B) $81,620
• C) $41,000
• D) $29,640

---

Definitions:

Middle Eastern

Pertaining to the geographic region, cultures, peoples, or affairs of the Middle East.

Nonverbal Communication

The transmission of messages or signals through a non-linguistic means, including facial expressions, gestures, posture, and tone of voice.

Cross-Cultural Differences

The variations in practices, norms, and values observed among individuals from different cultural backgrounds.

Blaming The Victim

A phenomenon where the victim of a crime, accident, or any type of abusive maltreatment is held entirely or partially at fault for the incident.