Shadee Corp. expects to sell 510 sun visors in May and 430 inJune. Each visor sells for $17. Shadee’s beginning and endingfinished goods inventories for May are 80 and 40 units,respectively. Ending finished goods inventory for June will be 70units.
Each visor requires a total of $4.50 in direct materials thatincludes an adjustable closure that the company purchases from asupplier at a cost of $2.00 each. Shadee wants to have 27 closureson hand on May 1, 21 closures on May 31, and 21 closures on June30. Additionally, Shadee’s fixed manufacturing overhead is $800 permonth, and variable manufacturing overhead is $2.25 per unitproduced.
Required:
1. Determine Shadee's budgeted cost of closurespurchased for May and June.
2. Determine Shadee's budget manufacturingoverhead for May and June.
