Class Activity This assignment is intended to help you practice creating a master budget. Your responses in the yellow cells of the "Budget" tab will be grade for completion. There are 30 yellow cells, and each yellow cell is worth 0.1 points. You can earn at most 3.0 points on this assignment. uses the following information to build its master budget for 2017 A manufacturer a) Projected Quarterly Sales in Units Year Quarter Units 1 2017 40,200 2 2017 11,200 3 2017 47,600 4 87300 2017 2018 1 6,600 b) The selling price per unit is S455.00 c) The company had 8,844 units in its ending inventory on December 31, 2016. The company prefers to keep 22% of the next quarters projected sales volume in its ending inventory for each quarter d) Each unit produced needs 8 pounds of direct materials. The company had 45,024 pounds of direct material in its ending inventory on December 31,2016. The company prefers to keep enough of the direct materials it needs on hand to meet 14% of the next quarter's projected sales volume. e) Each pound of direct materials costs $5.69 Each unit produced needs 3 hours of direct labor. Each hour of direct labor costs the company $75.83 g) Total factory overhead each quarter consists of S7,511 of fixed overhead and variable o verhead based on $3.60 per direct labor hour. h) The company incurs variable costs of $0.43 per unit for sales agents' commissions, $1.93 per unit for shipping, and S0.33 per unit for office supplies. Each quarter, the company incurs fixed costs of S30,500 for advertising, S93,000 for office rent, and S18,400 for other office expenses. In the second and fourth quarters, the company incurrs S7,100 of insurance expense on its corporate headquarters. The company plans to buy land in Quarter 4 of 2017 for $814,994. The company also plans to replace old machinery in Quarter 2 of 2017 by buying new machinery for S131,187 j) The prior year ending balance in accounts recievable was S28,800, of which 84% was incurred n the fourth quarter of 2016 and 16% was incurred in the third quarter of 2016. The company collects 27% of occur. Another 51.1% of each quarter's sales are collected one each quarters sales in the quarter when the quarter after they occur. The remaining 21.9% of each quarters sales are collected two quarters after they k All direct material purchases are made on account. All direct labor costs, overhead costs involving cash, and period costs are paid in the quarter incurred. The prior year ending balance in accounts payable was $10,500. The company pays for 47% of each quarter's purchases in the quarter when they occur. The remaining 53% of each quarter's purchases are paid for one quarter after they occur. The factory overhead includes depreciation on factory equipment. The factory equipment has a book alue of $94,000, no salvage value, and a useful life of 5 years. The company computes depreciation using the straight line method m) The company has an income tax rate of 36%. Income taxes are incurred at year-end and paid in the following period. Last year, the company's net income before taxes was $171.354. Each year's incom taxes are paid in the first quarter of the following year n) On December 31, 2016, the company had an ending cash balance of $12,900 and no bank loans. The company wants to have a minimum cash balance of S9,000 at the end of each quarter. If necessary, the company will borrow money from the bank in si,000 increments. The bank charges a quarterly interest rate of 8%. The company only borrows money at the start of the quarter. The company will only repay principal at the end of a quarter o) The product cost per unit this year is the same as it was last year p On December 31, 2016, the company had S266,193 ofiand, S868,235 of Building and Equipment, S799,462 of Accumulated Depreciation, and S753,604 of Common Stock