Budgeted Income Statement and Supporting Budgets

The budget director of Gold Medal Athletic Co., with the assistance of the controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income statement for March 2016:

Estimated sales for March:

Batting helmet	1,200 units at $40 per unit
Football helmet	6,500 units at $160 per unit

Estimated inventories at March 1:

Direct materials:
Plastic	90 lbs.
Foam lining	80 lbs.
Finished products:
Batting helmet	40 units at $25 per unit
Football helmet	240 units at $77 per unit

Desired inventories at March 31:

Direct materials:
Plastic	50 lbs.
Foam lining	65 lbs.
Finished products:
Batting helmet	50 units at $25 per unit
Football helmet	220 units at $78 per unit

Direct materials used in production:

In manufacture of batting helmet:
Plastic	1.20 lbs. per unit of product
Foam lining	0.50 lb. per unit of product
In manufacture of football helmet:
Plastic	3.50 lbs. per unit of product
Foam lining	1.50 lbs. per unit of product

Anticipated cost of purchases and beginning and ending inventory of direct materials:

Plastic	$6.00 per lb.
Foam lining	$4.00 per lb.

Direct labor requirements:

Batting helmet:
Molding Department	0.20 hr. at $20 per hr.
Assembly Department	0.50 hr. at $14 per hr.
Football helmet:
Molding Department	0.50 hr. at $20 per hr.
Assembly Department	1.80 hrs. at $14 per hr.

Estimated factory overhead costs for March:

Indirect factory wages	$86,000
Depreciation of plant and equipment	12,000
Power and light	$4,000
Insurance and property tax	2,300

Estimated operating expenses for March:

Sales salaries expense	$184,300
Advertising expense	87,200
Office salaries expense	32,400
Depreciation expenseoffice equipment	3,800
Telephone expenseselling	5,800
Telephone expenseadministrative	1,200
Travel expenseselling	9,000
Office supplies expense	1,100
Miscellaneous administrative expense	1,000

Estimated other income and expense for March:

Interest revenue	$940
Interest expense	872

Estimated tax rate: 30%

Cost of Goods sold Budget For the Month Ending March 31, 2016 lculator Direct materials: Cost of direct materials available for use Cost of direct materials placed in productiorn Total manufacturing costs Total work in process during the period Cost of goods manufactured Cost of finished goods available for sale Cost of goods sold