1. Expected manufacturing costs for Robert's Widgits are as follows:
- Variable Costs Fixed Costs per month
- Direct Materials $4.00/unit Supervisory salaries $100,000
- Direct Labor $2.00/unit Factory overhead $350,000
- Variable Overhead $1.50/unit
Estimate the manufacturing costs if Robert's produces 100,000 widgits in January.
Estimate the manufacturing costs if Robert's produces 120,000 widgits in February.
2. Rae's Bakery makes apple pies. Rae's Bakery plans to bake 2,000 pies in January and 2,500 pies in February. Each pie requires 2 pounds of baking apples. Baking apples cost $0.80 per pound. There will be 400 pounds of apples on hand on the first of January. The company wishes to have 500 pounds of baking apples on hand at the end of January and 300 pounds on hand at the end of February.
- How many pounds of apples should Rae's purchase in January?
- What is the cost in dollars for the required January purchase of apples?
- How many pounds of apples should Rae's purchase in February?