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: a. Estimated sales for March: Batting helmet 1,200 units at $40 per unit Football helmet 6,500 units at $160 per unit b. Estimated inventories at March 1: Direct materials: Plastic 90 lb. Foam lining 80 lb. Finished products: Batting helmet 40 units at $25 per unit Football helmet 240 units at $77 per unit c. Desired inventories at March 31: Direct materials: Plastic 50 lb. Foam lining 65 lb. Finished products: Batting helmet 50 units at $25 per unit Football helmet 220 units at $78 per unit d. Direct materials used in production: In manufacture of batting helmet: Plastic 1.20 lb. per unit of product Foam lining 0.50 lb. per unit of product In manufacture of football helmet: Plastic 3.50 lb. per unit of product Foam lining 1.50 lb. per unit of product e. Anticipated cost of purchases and beginning and ending inventory of direct materials: Plastic $6.00 per lb. $4.00 per lb. Foam lining f. 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. g. Estimated factory overhead costs for March: Indirect factory wages $86,000 Depreciation of plant and equipment 12,000 Power and light 4,000 2,300 Insurance and property tax h. Estimated operating expenses for March: Sales salaries expense $184,300 Advertising expense 87,200 Office salaries expense 32,400 Depreciation expense-office equipment 3,800 5,800 Telephone expense-selling Telephone expense-administrative 1,200 Travel expense-selling 9,000 Office supplies expense 1,100 1,000 Miscellaneous administrative expense i. Estimated other income and expense for March: Interest revenue $940 Interest expense 872 872 Interest expense j. Estimated tax rate: 30% Required: 1. Prepare sales budget for March. Gold Medal Athletic Co. Sales Budget For the Month Ending March 31 Unit Sales Unit Selling Price Volume Total Sales Batting helmet Football helmet Total revenue from sales 2. Prepare a production budget for March. Enter all amounts as positive numbers. Gold Medal Athletic Co. Production Budget For the Month Ending March 31 Units Batting helmet Football helmet Expected units to be sold Plus desired inventory, March 31 Total units required Less estimated inventory, March 1 Total units to be produced 3. Prepare a direct materials purchases budget for March. Enter all amounts as positive numbers. Gold Medal Athletic Co. Direct Materials Purchases Budget For the Month Ending March 31 Plastic Foam Lining Total Units required for production: Batting helmet Football helmet Plus desired units of inventory, March 31 Total units required Less estimated units of inventory, March 1 Total units to be purchased Unit price Total direct materials to be purchased 4. Prepare a direct labor cost budget for March. Gold Medal Athletic Co. Direct Labor Cost Budget For the Month Ending March 31 Molding Department Assembly Department Total Hours required for production: Batting helmet Football helmet Total hours required Hourly rate Total direct labor cost 5. Prepare a factory overhead cost budget for March. Gold Medal Athletic Co. Factory Overhead Cost Budget For the Month Ending March 31 Indirect factory wages Depreciation of plant and equipment Power and light Insurance and property tax Total 6. Prepare cost of goods sold budget for March. Work in process at the beginning of March is estimated to be $15,300, and work in process at the end of March is desired to be $14,800. Enter all amounts as positive numbers. Gold Medal Athletic Co. Cost of Goods Sold Budget For the Month Ending March 31 Direct materials: Cost of direct materials available for use Cost of direct materials placed in production 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 7. Prepare a selling and administrative expenses budget for March. Gold Medal Athletic Co. Selling and Administrative Expenses Budget For the Month Ending March 31 Selling expenses: Sales salaries expense $ Advertising expense Telephone expense-selling Travel expense-selling Total selling expenses Administrative expenses: Office salaries expense Depreciation expense-office equipment Telephone expense-administrative Office supplies expense Miscellaneous administrative expense Total administrative expenses Total operating expenses 8. Prepare a budgeted income statement for March. Enter all amounts as positive numbers. Gold Medal Athletic Co. Budgeted Income Statement For the Month Ending March 31 Operating expenses: Total operating expenses Income from operations Other income: Other expenses: Income before income tax Net income