Budgeted Income Statement and Supporting Budgets The budget director of Birding Homes & Feeders Inc., 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 January: Estimated sales for January: Bird house 15,000 units at $25 per unit Bird feeder 40,000 units at $15 per unit Estimated inventories at January 1: Direct materials: Wood 600 ft. Plastic 1,000 lbs. Finished products: Bird house 1,000 units at $15 per unit Bird feeder 2,500 units at $8 per unit Desired inventories at January 31: Direct materials: Wood 500 ft. Plastic 1,250 lbs. Finished products: Bird house 1,500 units at $15 per unit Bird feeder 3,000 units at $8 per unit Direct materials used in production: In manufacture of Bird House: Wood 0.80 ft. per unit of product Plastic 0.10 lb. per unit of product In manufacture of Bird Feeder: Wood 0.20 ft. per unit of product Plastic 1.00 lb. per unit of product Anticipated cost of purchases and beginning and ending inventory of direct materials: Wood $2.50 per ft. Plastic $0.80 per lb. Direct labor requirements: Bird House: Fabrication Department 0.40 hr. at $18 per hr. Assembly Department 0.20 hr. at $12 per hr. Bird Feeder: Fabrication Department 0.25 hr. at $18 per hr. Assembly Department 0.10 hr. at $12 per hr. Estimated factory overhead costs for January: Indirect factory wages $40,000 Depreciation of plant and equipment 20,000 Power and light 10,000 Insurance and property tax 5,000 Estimated operating expenses for January: Sales salaries expense $125,000 Advertising expense 80,000 Office salaries expense 40,000 Depreciation expenseoffice equipment 4,000 Travel expenseselling 25,000 Office supplies expense 2,500 Miscellaneous administrative expense 3,500 Estimated other revenue and expense for January: Interest revenue $4,540 Interest expense 3,000 Estimated tax rate: 25% Required: 1. Prepare a sales budget for January. Birding Homes & Feeders Inc. Sales Budget For the Month Ending January 31 Unit Sales Volume Unit Selling Price Total Sales Bird house fill in the blank 1 $fill in the blank 2 $fill in the blank 3 Bird feeder fill in the blank 4 fill in the blank 5 fill in the blank 6 Total revenue from sales $fill in the blank 7 2. Prepare a production budget for January. For those boxes in which you must enter subtracted or negative numbers use a minus sign. Birding Homes & Feeders Inc. Production Budget For the Month Ending January 31 Units Bird House Bird Feeder Expected units to be sold fill in the blank 9 fill in the blank 10 Desired inventory, January 31 fill in the blank 12 fill in the blank 13 Total units available fill in the blank 15 fill in the blank 16 Estimated inventory, January 1 fill in the blank 18 fill in the blank 19 Total units to be produced fill in the blank 21 fill in the blank 22 3. Prepare a direct materials purchases budget for January. For those boxes in which you must enter subtracted or negative numbers use a minus sign. Birding Homes & Feeders Inc. Direct Materials Purchases Budget For the Month Ending January 31 Wood Plastic Total Required units for production: Bird house fill in the blank 23 fill in the blank 24 Bird feeder fill in the blank 25 fill in the blank 26 Desired units of inventory, January 31 fill in the blank 27 fill in the blank 28 Total units available fill in the blank 29 fill in the blank 30 Estimated units of inventory, January 1 fill in the blank 31 fill in the blank 32 Total units to be purchased fill in the blank 33 fill in the blank 34 Unit price $fill in the blank 35 $fill in the blank 36 Total direct materials to be purchased $fill in the blank 37 $fill in the blank 38 $fill in the blank 39 4. Prepare a direct labor cost budget for January. Birding Homes & Feeders Inc. Direct Labor Cost Budget For the Month Ending January 31 Fabrication Department Assembly Department Total Hours required for production: Bird house fill in the blank 40 fill in the blank 41 Bird feeder fill in the blank 42 fill in the blank 43 Total fill in the blank 44 fill in the blank 45 Hourly rate $fill in the blank 46 $fill in the blank 47 Total direct labor cost $fill in the blank 48 $fill in the blank 49 $fill in the blank 50 5. Prepare a factory overhead cost budget for January. Birding Homes & Feeders Inc. Factory Overhead Cost Budget For the Month Ending January 31 Indirect factory wages $fill in the blank 52 Depreciation of plant and equipment fill in the blank 54 Power and light fill in the blank 56 Insurance and property tax fill in the blank 58 Total factory overhead cost $fill in the blank 59 6. Prepare a cost of goods sold budget for January. Work in process at the beginning of January is estimated to be $9,000, and work in process at the end of January is estimated to be $10,500. For those boxes in which you must enter subtracted or negative numbers use a minus sign. Birding Homes & Feeders Inc. Cost of Goods Sold Budget For the Month Ending January 31 Finished goods inventory, January 1 $fill in the blank 61 Work in process inventory, January 1 $fill in the blank 63 Direct materials: Direct materials inventory, January 1 $fill in the blank 65 Direct materials purchases fill in the blank 67 Cost of direct materials available for use $fill in the blank 68 Direct materials inventory, January 31 fill in the blank 70 Cost of direct materials placed in production $fill in the blank 71 Direct labor fill in the blank 73 Factory overhead fill in the blank 75 Total manufacturing costs fill in the blank 76 Total work in process during period $fill in the blank 77 Work in process inventory, January 31 fill in the blank 79 Cost of goods manufactured fill in the blank 80 Cost of finished goods available for sale $fill in the blank 81 fill in the blank 83 Cost of goods sold $fill in the blank 84 7. Prepare a selling and administrative expenses budget for January. Birding Homes & Feeders Inc. Selling and Administrative Expenses Budget For the Month Ending January 31 Selling expenses: Depreciation expenseoffice equipment $fill in the blank 86 fill in the blank 88 fill in the blank 90 Total selling expenses $fill in the blank 91 Administrative expenses: $fill in the blank 93 fill in the blank 95 fill in the blank 97 fill in the blank 99 Total administrative expenses fill in the blank 100 Total operating expenses $fill in the blank 101 8. Prepare a budgeted income statement for January. In the Other revenue and expense section, indicate expenses as negative amounts. Birding Homes & Feeders Inc. Budgeted Income Statement For the Month Ending January 31 $fill in the blank 103 fill in the blank 105 $fill in the blank 107 Operating expenses: $fill in the blank 109 fill in the blank 111 Total operating expenses fill in the blank 112 Operating income $fill in the blank 113 Other revenue and expense: $fill in the blank 115 fill in the blank 117 fill in the blank 118 Income before income tax $fill in the blank 119 fill in the blank 121 Net income $fill in the blank 122