Deleon Inc. is preparing its annual budgets for the year ending December 31

Deleon Inc. is preparing its annual budgets for the year ending December 31, 2014. Accounting assistants furnish the data shown below.

Product JB 50Product JB 60

Sales budget:

Anticipated volume in units400,000200,000

Unit selling price$20$25

Production budget:

Desire ending finished goods units30,00015,000

Beginning finished goods units25,00010,000

Direct material budget:

Direct material per unit (pounds)23

Desired ending direct material pounds30,00010,000

Beginning direct material pounds40,00015,000

Cost per pound$3$4

Direct labor budget:

Direct labor time per unit$0.4$0.6

Direct labor rate per hour$12$12

Budgeted income statement:

Total unit cost$13$20

An accounting assistant has prepared the detailed manufacturing overhead budget and the selling and administrative expense budget. The latter shows selling expenses of $560,000 for product JB 50 and $360,000 for product JB 60, and administrative expenses of $540,000 for product JB 50 and $340,000 for product JB 60. Income taxes are expected to be 30%.

Instructions

Prepare the following budgets for the year. Show data for each product. Quarterly budgets should not be prepared.

(a) Sales

(b) Production

(c) Direct materials

(d) Direct labor

(e) Income statement