aste BIU - 118.DA. ipboard Font Alig 22 fr Exercise 3 - Prepare budgeted income statement and supporting budgets. Aftersun Company manufactures and sells an after burn gel called Salvation. The following data are available for preparing budgets for Snare for the first 2 quarters of 2017. Sales: quarter 1 - 30,000 units; quarter 2 - 50.000 unit. Selling price is $5 per unit. Direct materials: each unit of Salvation requires 4 pounds of aloe vera at a cost of $0.10 per pound and a plastic recipient that costs at $0.20 per unit. 3. Desired inventory levels: Type of Inventory Salvation (units) Aloe vera (pounds) Plastic recipient (unit) January 1 20,000 10,000 5,000 April 1 40,000 20,000 10,000 July 1 50,000 25,000 12,500 4. Direct labor direct labor time is 6 minutes per unit at an hourly rate of $10 per hour. 5. Selling and administrative expenses are expected to be 20% of sales plus $2,000 per quarter. 6. Interest Expense is $12,000. 1. Income taxes are expected to be 30% of income before income taxes. 8. The manufacturing overhead budget shows cost of $0.50 per unit produced Instructions Prepare the budgeted multi-step income statement for the first 6 months and all required operating budgets by quarters. (Note: Use variable and fixed in the selling and administrative expense budget) Do not prepare the manufacturing overhead budget or the direct materials budget for Plastic Recipient