Clark Company makes and sells artistic frames for pictures of weddings, graduations, and other special events. Ron Jangles, the controller, is responsible for preparing Clark's master budget and has accumulated the following information for 2018 (Click the icon to view some of the financial information) (Click the icon to view additional information) Read the requirements Requirement 1. Prepare a production budget and a direct manufacturing labor cost budget for Clark Company by month and for the first quarter of 2018. You may combine both budgets in one schedule. The direct manufacturing labor cost budget should include labor-hours and show the details for each labor cost category Start the schedule by preparing the production budget and calculating the total hours of direct manufacturing labor time needed for the three months in the quarter, then calculate the values for the quarter. Finish by preparing the bottom portion of the schedule for the direct manufacturing labor by month, then quarter (Enter the direct manufacturing labor-hours per une to one decimal place, XX Do not round interim calculations, and then enter all amounts in the budget jother than the direct manufacturing labor-hours per unit to the nearest whole number) Clark Company Budget for Production and Direct Manufacturing Labor For the Quarter Ended March 31, 2018 Budgeted sales (units) dandinn finished monde invento January February March pro Data table - x om act 2018 hen ring January February March April May the per atio Estimated sales in units 10,000 11,000 6,000 9,000 9,000 Selling price $ 54.00 $ 50.00 $ 50.00 $ 50.00 $ 50.00 for Direct manufacturing labor-hours per unit 3.5 3.5 1.0 1.0 1.0 Fo Wage per direct manufacturing labor-hour $ 8.00 $ 8.00 $ 8.00 $ 13.00 $ 13.00 kt Print Done ar al al More info In addition to wages, direct manufacturing labor-related costs include pension contributions of $0.50 per hour, worker's compensation insurance of $0.10 per hour, employee medical insurance of $0.30 per hour, and Social Security taxes. Assume that as of January 1, 2018, the Social Security tax rates are 7.5% for employers and 7.5% for employees. The cost of employee benefits paid by Clark on its direct manufacturing employees is treated as a direct manufacturing labor cost. Clark has a labor contract that calls for a wage increase to $13 per hour on April 1, 2018. New labor-saving machinery has been installed and will be fully operational by March 1, 2018. Clark expects to have 14,000 frames on hand at December 31, 2017, and it has a policy of carrying an end-of-month inventory of 100% of the following month's sales plus 50% of the second following month's sales. Requirements 1. Prepare a production budget and a direct manufacturing labor cost budget for Clark Company by month and for the first quarter of 2018. You may combine both budgets in one schedule. The direct manufacturing labor cost budget should include labor-hours and show the details for each labor cost category. 2. What actions has the budget process prompted Clark's management to take? 3. How might Clark's managers use the budget developed in requirement 1 to better manage the company? -