Electra Manufacturing, Inc., produces metal control valves used in the production of oil eld equipment. The control valves are sold to various gas and oil engineering companies through out the United States. Projected sales in units for the coming four months are as follows: January 20000 control valves February 25000 control valves March 30000 control valves April 30000 control valves May 22000 control valves Thefollowing data pertain to production policies and manufacturing specications followed by Electra: a. Finished goods inventory on January 1 is 13,000 units. The desired ending inventory for each month is 70 percent ofthe next month's sales. b. The data on material used are as follows: for every valve 6 pounds of metal are used. One pound of metal costs $5. RM inventory on January 1 includes 60,000 pounds ofmetal. The desired ending RM inventory for each month dictates that sufcient materials are on hand to produce 50 percent of next month's estimated production. c. The direct labor used to make one valve is two hours. The average direct labor cost per hour is $14. d. Overhead each month is estimated as follows (variable costs are per unit produced): Fixed Cost Component Variable Cost Component Supplies $ - $1.00 Power ~ 1.1 Maintenance 28,000 2.1 Supervision 14,000 ~ Depreciation 100,000 ~ Taxes 7,000 ,_ Other 56,000 3.6 Prepare the following budgets for each month (January, February and March) and for the quarter in total: 1. Sales budget. 2. Production budget. 3. Direct materials purchase budget. 4. Direct labor budget. 5. Overhead budget. 6. Selling and administrative expense budget. 7. Ending FG budget. 8. Cost of goods sold budget. Assume that beginning inventory in January is valued at $70/unit and the company uses FIFO. 9. Budgeted income statement (ignore income taxes) 10. Cash budget. i.e., for each budget you need to prepare four columns: January, February, March and Quarter 1 (total for all three months, i.e., total for the first quarter)