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    Budgeting for Frames R Us

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    Frames R Us manufactures picture frames for various retail outlets. Budgeted sales and production information for the next quarter is presented in the table.
    September October November December
    Units Sales 8,500 11,500 18,000 25,000
    Direct Labor hours per frame 1.50 1.50 1.50 1.50
    Direct labor cost per hour $15.00 $17.50 $17.50 $17.50

    Finished Goods Inventory, August 31st 10,000 Units

    Frames R Us has an inventory policy where ending Finished Goods inventory should be equal to 75% of the next month's unit sales, except for November and December. Ending inventory needs to be 1.5 times next month's sales, in anticipation of the holiday sales.

    Based on this information what is estimated labor cost for the month of November?
    a. $748,125
    b. $843,750
    c. $945,000
    d. $984,375
    e. $1,102,500

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    https://brainmass.com/business/capital-budgeting/budgeting-frames-324089

    Solution Preview

    Frames â??R Us manufactures picture frames for various retail outlets. Budgeted sales and production information for the next quarter is presented in the table.
    September October November December
    Units Sales 8,500 11,500 18,000 ...

    Solution Summary

    This solution assists with the budgeting problem for Frames R Us. Budget sales and production information for the next quarter are determined.

    $2.19

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