Actual sales in December were $ 71 comma 000$71,000. Selling price per unit is projected to remain stable at $ 12$12 per unit throughout the budget period. Sales for the first five months of the upcoming year are budgeted to be as follows: January . . . . . . . . . $99,600 February . . . . . . . . $118,800 March . . . . . . . . . . $115,200 April . . . . . . . . . . . . $108,000 May . . . . . . . . . . . . $103,200 b. Sales are 3535% cash and 6565% credit. All credit sales are collected in the month following the sale. c. DamonDamon Manufacturing has a policy that states that each month's ending inventory of finished goods should be 1010% of the following month's sales (in units). d. Of each month's direct material purchases, 2020% are paid for in the month of purchase, while the remainder is paid for in the month following purchase. ThreeThree pounds of direct material is needed per unit at $ 2.00$2.00 per pound. Ending inventory of direct materials should be 20 %20% of next month's production needs. e. Most of the labor at the manufacturing facility is indirect, but there is some direct labor incurred. The direct labor hours per unit is 0.050.05. The direct labor rate per hour is $ 9$9 per hour. All direct labor is paid for in the month in which the work is performed. The direct labor total cost for each of the upcoming three months is as follows: January . . . . . . . . . $3,807 February . . . . . . . . $4,442 March . . . . . . . . . . $4,293 f. Monthly manufacturing overhead costs are $ 5 comma 500$5,500 for factory rent, $ 2 comma 900$2,900 for other fixed manufacturing expenses, and $ 1.10$1.10 per unit for variable manufacturing overhead. No depreciation is included in these figures. All expenses are paid in the month in which they are incurred. g. Computer equipment for the administrative offices will be purchased in the upcoming quarter. In January, DamonDamon Manufacturing will purchase equipment for $ 5 comma 000$5,000 (cash), while February's cash expenditure will be $ 12 comma 200$12,200 and March's cash expenditure will be $ 16 comma 600.$16,600. h. Operating expenses are budgeted to be $ 1.25$1.25 per unit sold plus fixed operating expenses of $ 1 comma 800$1,800 per month. All operating expenses are paid in the month in which they are incurred. i. Depreciation on the building and equipment for the general and administrative offices is budgeted to be $ 4 comma 800$4,800 for the entire quarter, which includes depreciation on new acquisitions. j. DamonDamon Manufacturing has a policy that the ending cash balance in each month must be at least $ 4 comma 000$4,000. It has a line of credit with a local bank. The company can borrow in increments of $ 1 comma 000$1,000 at the beginning of each month, up to a total outstanding loan balance of $ 130 comma 000$130,000. The interest rate on these loans is 11% per month simple interest (not compounded). The company would pay down on the line of credit balance in increments of $ 1 comma 000$1,000 if it has excess funds at the end of the quarter. The company would also pay the accumulated interest at the end of the quarter on the funds borrowed during the quarter. k. The company's income tax rate is projected to be 30% of operating income less interest expense. The company pays $ 10 comma 000$10,000 cash at the end of February in estimated taxes. PrintDone