Acct

Wiley PLUS Exercises – ACC/ 561 Accounting

Week 5: Exercises E 20-2, E20-5, Brief Exercise BE21-4, and Exercise E22-5

E 20-2: Zeller Electronics Inc. produces and sells two models of pocket calculators, XQ- 103 and XQ-104. The calculators sell for $12 and $25, respectively. Because of the intense competition Zeller faces, management budgets sales semiannually. Its projections for the first 2 quarters of 2010 are as follows. Reference Study Objective 03 Unit Sales Product Quarter 1 Quarter 2

XQ-103 20,000 25,000 XQ-104 12,000 15,000

No changes in selling prices are anticipated.

Instructions:
Prepare a sales budget for the 2 quarters ending June 30, 2010. List the products and show for each quarter and for the 6 months, units, selling price, and total sales by product and in total.

E 20-5: Moreno Industries has adopted the following production budget for the first
4 months of 2011. Month Units Month Units

January 10,000 March 5,000 February 8,000 April 4,000

Each unit requires 3 pounds of raw materials costing $2 per pound. On December 31,
2010, the ending raw materials inventory was 9,000 pounds. Management wants to have a raw materials inventory at the end of the month equal to 30% of next month’s production requirements. Reference Study Objective 03

Instructions:
Prepare a direct materials purchases budget by month for the first quarter.