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 lbs. Foam lining 80 lbs.

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 lbs. Foam lining 65 lbs.

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 1.2 lbs. per unit of product Foam lining 0.5 lb. per unit of product

In manufacture of football helmet: Plastic 3.5 lbs. per unit of product Foam lining 1.5 lbs. per unit of product

e. Anticipated cost of purchases and beginning and ending inventory of direct materials: Plastic $6 per lb. Foam lining $4 per lb.

f. Direct labor requirements: Batting helmet: Molding Department 0.2 hr. at $20 per hr. Assembly Department 0.5 hr. at $14 per hr.

Football helmet: Molding Department 0.5 hr. at $20 per hr. Assembly Department 1.8 hrs. at $14 per hr.

g. Estimated factory overhead costs for March:

Line Item Description Amount Indirect factory wages $86,000 Depreciation of plant and equipment 12,000 Power and light 4,000 Insurance and property tax 2,300 h. Estimated operating expenses for March: Line Item Description Amount 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 i. Estimated other revenue and expense for March:

Line Item Description Amount Interest revenue $940 Interest expense 872 j. Estimated tax rate: 30%

1. Prepare a sales budget for March. Enter all amounts as positive numbers. 5. Prepare a factory overhead cost budget for March. 6. Prepare a 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 Gold Medal Athletic Co. Cost of Goods Sold Budget For the Month Ending March 31 7. Prepare a selling and administrative expenses budget for March. Gold Medal Ath Selling and Administrative For the Month Endi Selling expenses: Total selling expenses Administrative expenses: Total administrative expenses Total operating expenses 8. Prepare a budgeted income statement for March