Rainwater Corp. expects to sell 560 umbrellas in May and 440 in June. Each umbrella sells for $15. Rainwater%u2019s beginning and ending finished goods inventories for May are 70 and 45 units, respectively. Ending finished goods inventory for June will be 50 units. Each umbrella requires a total of $4.50 in direct materials that includes an opening mechanism that the company purchases from a supplier at a cost of $2.00 each. Rainwater wants to have 31 mechanisms on hand at May 1, 23 mechanisms at May 31, and 25 mechanisms at June 30. Additionally, Rainwater%u2019s fixed manufacturing overhead is $1,100 per month, and variable manufacturing overhead is $2.75 per unit produced.
| Requirement 1: |
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Compute the budgeted cost of mechanisms purchased for May and June.
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| Requirement 2: |
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Compute the budgeted manufacturing overhead for May and June.
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