Diane Buswell is preparing the 2020 budget for one of Current Designs rotomolded kayaks. Extensive meetings with members of the sales department and executive team have resulted in the following unit sales projections for 2020.

Quarter 1		1,000	kayaks
Quarter 2		1,300	kayaks
Quarter 3		850	kayaks
Quarter 4		850	kayaks

Current Designs policy is to have finished goods ending inventory in a quarter equal to 15% of the next quarters anticipated sales. Preliminary sales projections for 2021 are 1,100 units for the first quarter and 1,300 units for the second quarter. Ending inventory of finished goods at December 31, 2019, will be 150 rotomolded kayaks. Production of each kayak requires 40 pounds of polyethylene powder and a finishing kit (rope, seat, hardware, etc.). Company policy is that the ending inventory of polyethylene powder should be 20% of the amount needed for production in the next quarter. Assume that the ending inventory of polyethylene powder on December 31, 2019, is 19,000 pounds. The finishing kits can be assembled as they are needed. As a result, Current Designs does not maintain a significant inventory of the finishing kits. The polyethylene powder used in these kayaks costs $1.00 per pound, and the finishing kits cost $140 each. Production of a single kayak requires 2 hours of time by more experienced, type I employees and 3 hours of finishing time by type II employees. The type I employees are paid $12 per hour, and the type II employees are paid $9 per hour. Selling and administrative expenses for this line are expected to be $40 per unit sold plus $6,000 per quarter. Manufacturing overhead is assigned at 140% of labor costs.

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Prepare the production budget for this product line by quarter and in total for 2020. CURRENT DESIGNS Production Budget For the Year Ending December 31, 2020 Q2 Total Expected Unit Sales 1000 850 195 127.5 127.5 Add : Desired Ending Finished Goods Unit Total Required Units Less : Beginning Finished Goods Unit 1195 1427.5 977.5 1015 -150 i -250 - 127.5 -127.5 1045 850 11775 Required Production Units 8875 3960 : e Textbook and Media Prepare the direct materials budget for this product line by quarter and in total for 2020. (Round cost per pound to 2 decimal places, eg. 1.25 and other answers to O decimal places, eg. 125.) CURRENT DESIGNS Direct Materials Budget-Polyethylene Powder For the Year Ending December 31, 2020 : Quarter Q1 Q2 Q3 Total Units to be produced Pounds of Polyethylene Powder Per Unit - Total Pounds Needed for Production Add : Desired Ending Inventory of Powder Total Pounds of Powder Required : Less : Beginning Inventory of Powder Pounds of Polyethylene Powder to be purchased Cost Per Pound Cost of Polyethylene Powder to be purchased Cost of Required Finishing Kits Total Costs for Direct Materials 9 Prepare the direct labor budget for this product line by quarter and in total for 2020. CURRENT DESIGNS Direct labor Budget For the Year Ending December 31, 2020 - Q2 More skilled labor Q1 Q3 04 TOTAL Units to be produced Total Direct Labor Cost for More Skilled Labor Total Required Direct Labor Hours Total Cost of Direct Materials Purchases Less skilled labor Units to be produced Q3 04 TOTAL Direct Labor Cost Per Hour Total Direct Labor Cost for Less Skilled Labor - Units to be produced Total Required Direct Labor Hours Total Direct Labor Cost $ $ Prepare the manufacturing overhead budget for this product line by quarter and in total for 2020. CURRENT DESIGNS Manufacturing Overhead Budget For the Year Ending December 31, 2020 Q2 Q1 Q3 TOTA Direct Labor Manufacturing Overhead Rate Per Direct Labor Dollar Total Manufacturing Overhead e Textbook and Media - Your answer is partially correct. Prepare the selling and administrative expenses budget for this product line by quarter and in total for 2020. CURRENT DESIGNS Selling and Administrative Expense Budget For the Year Ending December 31, 2020 - Q2 Q3 L Q1 Q4 TOTAL 9 Expected Unit Sales Variable Expenses $ Fixed Expenses Total Selling and Administrative Expenses : $ e Textbook and Media