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Willison Company produces stuffed toy animals; one of these is Betty Rabbit. Each rabbit takes 0.2 yard of fabric and six ounces of polyfiberfill. Fabric costs $3.50 per yard, and polyfiberfill is $0.05 per ounce. Willison has budgeted production of stuffed rabbits for the next 4 months as follows:

	Units
October	20,000
November	40,000
December	25,000
January	30,000

Inventory policy requires that sufficient fabric be in ending monthly inventory to satisfy 15% of the following month's production needs and sufficient polyfiberfill be in inventory to satisfy 30% of the following month's production needs. Inventory of fabric and polyfiberfill at the beginning of October equals exactly the amount needed to satisfy the inventory policy.

Each rabbit produced requires (on average) 0.10 direct labor per hour. The average cost of direct labor is $15.50 per hour.

Required:

1. Prepare a direct materials purchases budget of fabric for the last quarter of the year, showing purchases in units and in dollars for each month and for the quarter in total. Do not include a multiplication symbol as part of your answer.

Willison Company
Direct Materials Purchases Budget for Fabric
For the Fourth Quarter
	October	November	December	Total
Units to be produced	fill in the blank	fill in the blank	fill in the blank	fill in the blank
Direct materials per unit	fill in the blank	fill in the blank	fill in the blank	fill in the blank
Production needs	fill in the blank	fill in the blank	fill in the blank	fill in the blank
Desired ending inventory	fill in the blank	fill in the blank	fill in the blank	fill in the blank
Total needs	fill in the blank	fill in the blank	fill in the blank	fill in the blank
Less: Beg. inventory	fill in the blank	fill in the blank	fill in the blank	fill in the blank
Direct materials to be purchased	fill in the blank	fill in the blank	fill in the blank	fill in the blank
Cost per yard	$fill in the blank	$fill in the blank	$fill in the blank	$fill in the blank
Total purchase cost	$fill in the blank	$fill in the blank	$fill in the blank	$fill in the blank

2. Prepare a direct materials purchases budget of polyfiberfill for the last quarter of the year, showing purchases in units and in dollars for each month and for the quarter in total. Do not include a multiplication symbol as part of your answer.

Willison Company
Direct Materials Purchases Budget for Polyfiberfill
For the Fourth Quarter
	October	November	December	Total
Units to be produced	fill in the blank	fill in the blank	fill in the blank	fill in the blank
Direct materials per unit	fill in the blank	fill in the blank	fill in the blank	fill in the blank
Production needs	fill in the blank	fill in the blank	fill in the blank	fill in the blank
Desired ending inventory	fill in the blank	fill in the blank	fill in the blank	fill in the blank
Total needs	fill in the blank	fill in the blank	fill in the blank	fill in the blank
Less: Beg. inventory	fill in the blank	fill in the blank	fill in the blank	fill in the blank
Direct materials to be purchased	fill in the blank	fill in the blank	fill in the blank	fill in the blank
Cost per ounce	$fill in the blank	$fill in the blank	$fill in the blank	$fill in the blank
Total purchase cost	$fill in the blank	$fill in the blank	$fill in the blank	$fill in the blank

3. Prepare a direct labor budget for the last quarter of the year, showing the hours needed and the direct labor cost for each month and for the quarter in total. Do not include a multiplication symbol as part of your answer.

Willison Company
Direct Labor Budget
For the Fourth Quarter
	October	November	December	Total
Units to be produced	fill in the blank	fill in the blank	fill in the blank	fill in the blank
Direct labor time per unit	fill in the blank	fill in the blank	fill in the blank	fill in the blank
Total hours needed	fill in the blank	fill in the blank b	fill in the blank	fill in the blank
Wages per hour	$fill in the blank	$fill in the blank	$fill in the blank	$fill in the blank
Total direct labor cost	$fill in the blank	$fill in the blank	$fill in the blank	$fill in the blank

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