Cubs Incorporated manufactures a product with a selling price of $60 per unit. Units and monthly cost data follow:

Cubs, Inc. pays all bills in the month incurred. All sales are on account with 50 percent collected the month of sale and the balance collected the following month. There are no sales discounts or bad debts. Cubs, Inc. desires to maintain an ending finished goods inventory equal to 20 percent of the following month's sales and a raw materials inventory equal to 10 percent of the following month's production. January 1, 2017, inventories are in line with these policies. Actual unit sales for December and budgeted unit sales for January, February, and March of 2017 are as follows:

Additional information:

• The January 1 beginning cash is projected as $6,000.
• For the purpose of operational budgeting, units in the January 1 inventory of finished goods are valued at variable manufacturing cost.
• Each unit of finished product requires one unit of raw materials.
• Cubs, Inc. intends to pay a cash dividend of $12,000 in January.

NOTE:

For the entire problem - do not use any negative signs with your answers unless appropriate for net income(loss) or ending balance.

Required:

(a) A production budget for January and February.

(b) A purchase budget in units for January

(c) A manufacturing cost budget for January

Variable: Selling and administrative Direct materials Direct labor Variable manufacturing overhead Fixed: $5 per unit sold 12 per unit manufactured 12 per unit manufactured 6 per unit manufactured Selling and administrative $17,000 per month Manufacturing (including depreciation of $11,000) 34,000 per month CUBS INCORPORATED Sales Budget For the Months of January, February, and March 2017 Month December January February March Sales- Units Sales- Dollars 11,250 10,000 15,000 13,000 $675,000 $600,000 $900,000 $780,000