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Production, direct materials, and direct labor budgets Gerrad Manufacturing has projected sales of its product for the next six months as follows. January 180 units February 420 units March April May June The finished product requires 3 pounds of raw material and 10 hours of direct labor. Gerrad tries to maintain a Finished Goods ending inventory equal to the next two months of sales and a Raw Material ending inventory equal to one-half of the current month's production needs. January's beginning inventories are expected to conform to company policy a. Prepare a production budget for February, March, and April Note: a negative sign in your schedule to indicate that an amount is subtracted. February April 600 units 540 units 240 units 180 units March Sales EL Total units needed Units produced March b. Prepare a forecast of the units and cost of raw material that will be required for February March, and April. The expected cost per pound of raw material is expected to be $2 in February, 52.30 in March, and $2.40 in April February April Required raw material units Cost of raw material purchases c. Prepare a direct labor budget (assuming a $12 per hour rate) for February March, and April February Units produced $ 5 March April DLHS per unit Total hours Cost per DLH Cost of Du 5 $ $ $ $ $ Previous 19 Save Answers Next

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