During the first calendar quarter of the year, Clinton Corporation is planning to manufacture a new product and introduce it in two regions. Market research indicates that sales will be $8,000$ units in the urban region at a unit price of $$53$ and $7,000$ units in the rural region at $$48$ each. Because the sales manager expects the product to catch on$,$ he has asked for production sufficient to generate a $6,000-$unit ending inventory. The production manager has furnished the following estimates related to manufacturing costs and operating expenses: Variable Fixed $($per unit$)($total$)$ Manufacturing costs: Direct materials A $(4$ lb$.$ @ $$3\mathrm{.}15/$lb$.)$ $$12\mathrm{.}60-$ B $(2$ lb$.$ @ $$4\mathrm{.}65/$lb$.)9\mathrm{.}30-$ Direct labor $(0\mathrm{.}5$ hours per unit$)7\mathrm{.}50-$ Manufacturing overhead: Depreciation $-$ $$7,650$ Factory supplies $0\mathrm{.}904,500$ Supervisory salaries $-28,800$ Other $0\mathrm{.}7522,950$ Operating expenses: Selling: Advertising $-22,500$ Sales salaries& commissions$*1\mathrm{.}5015,000$ Other$*0\mathrm{.}903,000$ Administrative: Office salaries $-2,700$ Supplies $0\mathrm{.}151,050$ Other $0\mathrm{.}081,950*$Varies per unit sold, not per unit produced. a$.$ Assuming that the desired ending inventories of materials A and B are $6,000$ and $8,000$ pounds, respectively, and that work$-$in$-$process inventories are immaterial, prepare budgets for the calendar quarter in which the new product will be introduced for each of the following operating factors: Do not use negative signs with any of your answers below. $1.$ Total sales $Answer $12.$ Production Answer $2$ units $3.$ Material purchase cost Material A Material B Total pounds $($lbs$.)$ required for production Desired ending materials inventory Total pounds to be available Beginning materials inventory Total material to be purchased $($lbs$.)$ Total material purchases $($$$)4.$ Direct labor costs $Answer $155.$ Manufacturing overhead costs Fixed Variable Total Depreciation Factory supplies Supervisory salaries Other Total manufacturing overhead $6.$ Selling and administrative expenses Fixed Variable Total Selling expenses: Advertising Sales salaries and commissions Other Total selling expenses Administrative expenses: Office salaries Supplies Other Total administrative expenses Total selling and administrative expenses b$.$ Using data generated in requirement $($a$),$ prepare a budgeted income statement for the calendar quarter. Assume an overall effective income tax rate of $30\%.$ Round answers to the nearest whole number. Do not use negative signs with your answers. Clinton Corporation Budgeted Income Statement For the Quarter Ended March $31$ Sales Cost of Goods Sold: Beginning Inventory $-$ Finished Goods Material: Beginning Inventory $-$ Material Material Purchases Material Available Ending Inventory $-$ Material Direct Material Direct Labor Manufacturing Overhead Total Manufacturing Cost Cost of Goods Available for Sale Ending Inventory $-$ Finished Goods Cost of Goods Sold Gross Profit Operating Expenses: Selling Expenses Administrative Expenses Total Operating Expenses Income before Income Taxes Income Tax Expense Net Income