Luchini corporation makes one product and it provided the following information to prepare the master budget for the next four months of operations:
the budgeted selling price per unit is $111.
budgeted unit sales for april, may, june, and july are 7,100, 10,100, 13,300, and 14,000 units, respectively. all sales are on credit.
regarding credit sales, 40% are collected in the month of the sale and 60% in the following month.
the ending finished goods inventory equals 10% of the following month's sales.
the ending raw materials inventory equals 30% of the following month’s raw materials production needs.
each unit of finished goods requires 5 pounds of raw materials.
the raw materials cost $5.00 per pound.
regarding raw materials purchases, 40% are paid for in the month of purchase and 60% in the following month.
the direct labor wage rate is $18.00 per hour.
each unit of finished goods requires 2.9 direct labor-hours.
variable manufacturing overhead is $7.00 per direct labor-hour.
fixed manufacturing overhead is zero.
the estimated finished goods inventory balance at the end of may is closest to:
multiple choice
$102,676
$111,986
$26,999
$129,675