Budgeted income statement and supporting budgets for three montha Bellaire Inc. gathered the following data for use in developing the budgets for the first quarter (January February, Harchy of its focal year: a. Estimated sales at $125 per unit: January 25,000 units February 30,000 units March 45,000 units April 50,000 units b. Estimated finished goods inventories: January 1 2,000 units January 31 10% of next month's sales February 28 10% of next month's sales March 31 20% of next month's sales c. Work in process inventories are estimated to be insignificant (zero). d. Estimated direct materials inventories: January 1 January 31 February 28 March 31 1,000 lbs 1.500 lbs. 2,000 lbs 2,500 lbs. e Manufacturing costs: Per Unit $12 60 5 Direct materials (0.8 lb. per unit * $15 per lb.) Direct labor (2.5 hrs. per unit * $24 per hr.) Variable factory overhead ($1.20 per direct labor hour) Fixed factory overhead ($200,000 per month, allocated using 40,000 units) Total per-unit manufacturing costs f. Selling expenses: Variable selling expenses $4 per unit Fixed selling expenses $150,000 Administrative expenses (all fixed costs) $400,000 $80 1. Prepare a sales budget for March Bellaire Inc. Sales Budget For the First Quarter Ending March 3 February March 30,000 45,000 January 25,000 First Quarter 100,000 Estimated units sold 125 XS X$ 125 125 125 xs Selling price per unit xs 3.125,000 12.500,000 3,750,000 5,625,000 Total budgeted sales 2. Prepare a production budget for March Bellaire Inc. Production Budget For the First Quarter Ending March 3 January February 25,000 30,000 March First Quarter Estimated units sold 45.000 100,000 Desired ending inventory 3,000 4,500 5,000 5.000 Total units available for sale 28,000 34,500 50,000 105.000 Less estimated beginning inventory 2,000 -3,000 -4.500 -2,000 Total units to be produced 26,000 V 31,500 45,500 103.000 3. Prepare a direct materials purchases budget for March Bellaire Inc. Direct Materials Purchases Budget For the First Quarter Ending March 31 January February Units to be produced 26,000 31,500 Materials required per unit 0.8 lb. 0.8 Ib. Materials required for production 20,800 lbs. 25,200 lbs. Desired ending inventory 1,500 lbs. 2,000 lbs. March First Quarter 103,000 45,500 0.8 lb. 0 lb 36,400 lbs. 82.400 lbs. 2.500 lbs. 2.500 lbs 22,300 lbs. 27.200 lbs. 38.900 lbs. 84.900 lbs. Total materials available for use Less estimated beginning inventory Total materials to be purchased 1.000 lbs. 1,500 lbs. 2,000 lbs. 1,000 lbs. 21.300 lbs. 25,700 lbs. 36,900 lbs. 83,900 lbs Cost per pound 15 XS 15 15 XS 15 Cost of direct materials to be purchased 319,500 385,500 553,500 1.258,500 4. Prepare a direct labor cost budget for March Bellaire Inc. Direct Labor Cost Budget For the First Quarter Ending March 31 January February 26,000 31.500 March First Quarter Units to be produced 45.500 103,000 Direct labor required per unit 2.5 hrs. X 2.5 hrs. 2.5 hrs. 2.5 hrs. Direct labor hours required for production 65,000 hrs. 78.750 hrs. 113,750 hrs. 257.500 hrs Direct labor hourly rate xs 24 XS 24 x 24 5 24 Direct labor cost 1,560,000 1.890,000 2.730,000 6,180.000 March First Quarter S. Prepare a factory overhead cost budget for March Bellaire Inc. Factory Overhead Cost Budget For the First Quarter Ending March 31 January February Variable factory overhead: Budgeted direct labor hours 65,000 hrs. 78,750 hrs. Variable factory overhead rate xs 1.2 Budgeted variable factory overhead 78,000 V 94,500 Fixed factory overhead: Budgeted fixed factory overhead 200,000 200.000 113,750 hrs 257.500 hrs. 1.2 xs 1.2 XS 1.2 136,500 309,000 200.000 600,000 Total factory overhead cost 278,000 294,500 336,500 909,000 6. Prepare a cost of goods sold budget for March. Bellaire Inc. Cost of Goods Sold Budget For the First Quarter Ending March 31 January February March First Quarter Beginning finished goods inventory Cost of goods manufactured: Direct materials Direct labor Factory overhead Total cost of goods manufactured Cost of finished goods available for sale Ending finished goods inventory Cost of goods sold First Quarter 7. Prepare a selling and administrative expenses budget for March, Enter all amounts as positive number. Bellaire Inc. Selling and Administrative Expenses Budget For the First Quarter Ending March 31 January February March Selling expenses: Budgeted sales units Variable selling expenses per unit sold X x$ xs Total variable selling expenses Fixed selling expenses Total selling expenses Administrative expenses: Budgeted fixed administrative expenses Total selling and administrative expenses 8. Prepare a budgeted Income statement with budgeted operating income for March. Bellaire Inc. Budgeted Income Statement For the First Quarter Ending March 31 January February March Sales First Quarter Cost of goods sold Gross profit Selling and administrative expenses: Selling expenses Administrative expenses Total selling and administrative expenses Operating income