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: a. Estimated sales for January: 15,000 units at Bird house $25 per unit Bird feeder 40,000 units at $15 per unit b. Estimated inventories at January 1: Direct materials: Wood 600 ft. Plastic 1,000 lbs. Finished products: 1,000 units at Bird house $15 per unit Bird feeder 2,500 units at $8 per unit c. Desired inventories at January 31: Direct materials: Wood 500 ft. Plastic 1,250 lbs. Finished products: 1,500 units at Bird house $15 per unit Bird feeder 3,000 units at $8 per unit d. 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 1.00 lb. per unit Plastic of product e. Anticipated cost of purchases and beginning and ending inventory of direct materials: Wood $2.50 per ft. $0.80 per lb. Plastic f. 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. g. Estimated factory overhead costs for January: Indirect factory wages $40,000 Depreciation of plant and equipment 20,000 Power and light 10,000 5,000 Insurance and property tax h. Estimated operating expenses for January: Sales salaries expense $125,000 Advertising expense 80,000 Office salaries expense 40,000 Depreciation expense-office equipment 4,000 Travel expense-selling 25,000 Office supplies expense 2,500 3,500 Miscellaneous administrative expense i. Estimated other revenue and expense for January: Interest revenue $4,540 Interest expense 3,000 j. Estimated tax rate: 25% 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 $ $ $ Bird feeder Total revenue from sales $ $ 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 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 Bird feeder Desired units of inventory, January 31 Total units available Estimated units of inventory, January 1 Total units to be purchased Unit price S X $ $ X$ Total direct materials to be purchased $ $ $ $ 4. Prepare a direct labor cost budget for lanuary 4. Prepare a direct labor cost budget for January. Birding Homes & Feeders Inc. Direct Labor Cost Budget For the Month Ending January 31 Fabrication Assembly Department Total Department Hours required for production: Bird house Bird feeder Total Hourly rate $ X $ $ x $ Total direct labor cost $ $ $ $ $ $ 5. Prepare a factory overhead cost budget for January. Birding Homes & Feeders Inc. Factory Overhead Cost Budget For the Month Ending January 31 Total factory overhead cost 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 $$ Direct materials: $$ Cost of direct materials available for use $$ Cost of direct materials placed in production $$ Total manufacturing costs Total work in process during 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 January. Birding Homes & Feeders Inc. Selling and Administrative Expenses Budget For the Month Ending January 31 Selling expenses: $ $ Total selling expenses $ $ Administrative expenses: $$ Total administrative expenses Total operating expenses $ $ 8. Prepare a budgeted income statement for January. In the Other revenue and expense section, indicate expenses as negative amounts. Birding Homes & Feeders Inc. Budgeted Income Statement For the Month Ending January 31 $$ Operating expenses: $ $ Total operating expenses Operating income $$ Other revenue and expense: $ $ Income before income tax Net income