1. Preparing a Sales Budget Patrick Inc. sells industrial solvents in five-gallon drums. Patrick expects the following units to be sold in the first three months of the coming year. The average price for a drum is P35. Required: Prepare a sales budget for the first three months of the coming year, showing units and sales revenue by month and in total for the quarter. 2. Preparing a Production Budget Patrick Inc. makes industrial solvents. In the first four mounts of the coming year, Patrick expects the following unit sales: Patrick's policy is to have a 25% of next month's sales in ending inventory. On January 1 , it is expected that there will be 6,700 drums of solvent on hand. Required: Prepare a production budget for the first quarter of the year. Show the number of drums that should be produced each month as well as for the quarter in total. 3. Preparing a Direct Materials Purchases Budget Patrick Inc. makes industrial solvent sold in five-gallon drums. Planned production in units for the first three months of the coming year is: Each drum requires 5.5 gallons of chemicals and one plastic drum. Company policy requires that ending inventories of raw materials for each month be 15% of the next month's production needs. That policy was met for the ending inventory of December in the prior year. The cost of one gallon of chemicals is P2.00. The cost of one drum is P1.60. (Note: Round all unit amounts to the nearest unit. Required: a. Calculate the ending inventory of chemicals in gallons for December of the prior year, and for January and February. What is the beginning inventory of chemicals for January? b. Prepare a direct materials purchases budgets for chemicals for the months of January and February. c. Calculate the ending inventory of drums for December of the prior year, and for January and February. d. Prepare a direct materials purchases budgets for drums for the months of January and February. 4. Preparing a Direct Labor Budget Patrick Inc. makes industrial solvents. Planned production in units for the first three months of the coming year is: Each drum of industrial solvent takes 0.3 direct labor hours. The average wage is P18 per hour. Required: Prepare a direct labor budget for the months of January, February, and March, as well as the total for the first quarter. 5. Preparing an Overkead Budget Patrick Inc. makes industrial solvents. Budgeted direct labor hours for the first three months of the coming year are: The variable overhead rate is P0.70 per direct labor hour. Fixed overhead is budgeted at P2,750 per month. Required: Prepare an overhead budget for the months of January, February, and March, as well as the total for the first quarter. (Note: Round all dollar amounts to the nearest dollar.) 6. Preparing an Ending Finished Goods Inventory Budget. Andrew Company manufactures a line of office chairs. Each chair takes P14 of direct materials and uses 1.9 direct labor hours at P16 per direct labor hour. The variable overhead rate is P1.20 per direct labor hour and the fixed overhead rate is P1.60 per direct labor hour. Andrews expects to have 675 chairs in ending inventory. There is no beginning inventory of office chairs. Required: a. Calculate the unit product cost. (Note: Round to the nearest cent)) b. Calculate the cost of budgeted ending inventory. (Note: Round to the neareat dollar.) 7. Preparing a Cost of Goods Sold Budget Andrews Company manufactures a line of office chairs. Each chair takes P14 of direct materials and uses 1.9 direct labor hours at P16 per direct labor hour. The variable overhead rate is P1.20 per direct labor hour and the fixed overhead rate is P1.60 per direct labor hour. Andrews expects to produce 20,000 chairs next year an dexpects to have 675 chare in ending inventory. There is no beginning inventory of office chairs. Prepare a cost of goods sold budget for Andrews Company