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. 2. Prepare a production budget for March. For those boxes in which you must enter subtr 3. Prepare a direct materlals purchases budget for March. For those boxes in which you m 4. Prepare a direct labor cost budget for March. Enter all amounts as positive numbers. 5. Prepare a factory overhead cost budget for March. Gold Medal Athletic Co. Factory Overhead Cost Budget \begin{tabular}{lr} FactoryOverheadCostBudgetFortheMonthEndingMarch31 \\ \hline Indirect factory wages & \\ \hline Depreciation of plant and equipment & 86,000 \\ Power and llght & 12,000 \\ Insurance and property tax & 4,000 \\ Total factory overhead cost & 104,300 \\ \hline \end{tabular} Gold Medal Athletic Co. Cost of Goods Sold Budget For the Month Ending March 31 Direct materlals: Direct materlals Inventory, March 1 Direct materlals purchases Cost of direct materlals avallable for use Cost of direct materlals placed In production Total manufacturing costs Total work in process during period Cost of goods manufactured Cost of finished goods avallable 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: Total selling expenses Administrative expenses: 8. Prepare a budgeted Income statement for March. Gold Medal Athletic Co. Budgeted Income Statement For the Month Ending March 31 Operating expenses: Total operating expenses Operating Income Other revenue and expense: Income before Income tax