1. A sales budget is given below for one of the products manufactured by the OMI Co.: (10 Points) January.... February March April May June 25.000 units 40.000 units 65.000 units 45.000 units 35,000 units 30.000 units The inventory of finished goods at the end of each month must equal 20% of the next month's sales. However, on December 31 the finished goods inventory totaled only 4,000 units. Each unit of product requires three pounds of specialized material. Since the production of this specialized material by OMI's suppliers is sometimes irregular, the company has a policy of maintaining an ending inventory at the end of each month equal to 30% of the next month's production needs. This requirement had been met on January 1 of the current year. Required: a. Prepare a budget showing the required production each month for January, February, March, and April. b. Prepare a budget showing the quantity of switches to be purchased each month for January, February, and March W R SD 2. Bredder Supply Corporation manufactures and sells cotton gauze. Expected sales of gauze (in boxes) for upcoming months are as follows: June July. August September October... November December 35,000 39,000 41,000 37,000 34,000 33,000 36,000 Management likes to maintain a finished goods inventory equal to 20% of the next month's estimated sales. Required: Prepare the company's production budget for the third quarter of this year (the months of July, August and September). Include a column for each month and a total column for the entire quarter. (5 Points) ON OQD Det Draw Layout Review View Home Calb Real 11 B 3. Mulberry Clinic uses patient-visits as its measure of activity. The clinic bases its budgets on the following information: Revenue should be $48.70 per patient-visit. Personnel expenses should be $27.600 per month plus $14.70 per patient-visit. Medical supplies should be $1,000 per month plus $10.10 per patient-visit Occupancy expenses should be $9,500 per month plus $2.40 per patient-visit. Administrative expenses should be $3,800 per month plus $0.10 per patient-visit. The clinic reported the following actual results for August: Patient-visits Revenue Personnel expenses Medical supplies Occupancy expenses Administrative expenses 2.000 $96.630 $55,310 $21.540 $14.470 $3.960 Required: Prepare a report showing the clinic's revenue and spending variances for August. Label each variance as favorable (F) or unfavorable (U) (10 Points) E R s . F G . IN M