$6-22$ Budgeting; direct material usage, manufacturing cost, and gross margin. $($LO $2)$ Xander Manufacturing Company manufactures blue rugs, using wool and dye as direct materials. One rug is budgeted to use $36$ skeins of wool at a cost of $$2$ per skein and $0\mathrm{.}8$ gallons of dye at a cost of $$6$ per gallon. All other materials are indirect. At the beginning of the year Xander has an inventory of $458,000$ skeins of wool at a cost of $$961,800$ and $4,000$ gallons of dye at a cost of $$23,680.$ Target ending inventory of wool and dye is zero. Xander uses the FIFO inventory cost flow method. Xander blue rugs are very popular and demand is high, but because of capacity constraints the firm will produce only $200,000$ blue rugs per year. The budgeted selling price is $$2,000$ each. There are no rugs in beginning inventory. Target ending inventory of rugs is also zero. Xander makes rugs by hand, but uses a machine to dye the wool. Thus, overhead costs are accumulated in two cost pools$$one for weaving and the other for dyeing. Weaving overhead is allocated to products based on direct manufacturing labour$-$hours $($DMLH$).$ Dyeing overhead is allocated to products based on machine$-$hours $($MH$).$ There is no direct manufacturing labour cost for dyeing. Xander budgets $62$ direct manufacturing labour$-$hours to weave a rug at a budgeted rate of $$13$ per hour. It budgets $0\mathrm{.}2$ machine$-$hours to dye each skein in the dyeing process. The following table presents the budgeted overhead costs for the dyeing and weaving cost pools: BackThe table is as follows. Parameter Dyeing, based on $1,440,000$ M H Weaving, based on $12,400,000$ D M L H Variable costs blank Blank Indirect materials $ $0$ $$15,400,000$ Maintenance $6,560,0005,540,000$ Utilities $7,550,0002,890,000$ Fixed costs blank blank Indirect labour $347,0001,700,000$ Depreciation $2,100,000274,000$ Other $723,0005,816,000$ Total budgeted costs $17,280,000$ $$31,620,000$ Back$213$Required Prepare a direct materials usage budget in both units and dollars.Calculate the budgeted overhead allocation rates for weaving and dyeing.Calculate the budgeted unit cost of a blue rug for the year.Prepare a revenues budget for blue rugs for the year, assuming Xander sells $($a$)200,000$ or $($b$)185,000$ blue rugs $($i$.$e$.,$ at two different sales levels$).$Calculate the budgeted cost of goods sold for blue rugs under each sales assumption.Find the budgeted gross margin for blue rugs under each sales assumption.What actions might you take as a manager to improve profitability if sales drop to $185,000$ blue rugs?How might top management at Xander use the budget developed in requirements $16$ to better manage the company?

In MS Excel please