Exercise 13-10 (Part Level Submission) Indigo Company makes and sells artistic frames for pictures. The controller is responsible for preparing the master budget and has accumulated the following information for 2017. March Estimated unit sales January 10,900 $50.40 February 11,200 $47.30 8,800 $47.30 April 8,500 $47.30 May 8,600 $47.30 Sales price per unit Direct labor hours per unit 2.0 2.0 1.6 1.6 1.6 Wage per direct labor hour $7.00 $7.00 $7.00 $8.00 $8.00 Indigo has a labor contract that calls for a wage increase to $8.00 per hour on April 1. New labor-saving machinery has been installed and will be fully operational by March 1. Indigo expects to begin the year with 15,380 frames on hand and has a policy of carrying an end-of-month inventory of 100% of the following month's sales, plus 40% of the second following month's sales. Prepare a production budget for Indigo Company by month and for the first quarter of the year. INDIGO COMPANY Production Budget For the Quarter Ending March 31, 2017 v Jan Feb Mar Total Sales in Units 10,900 11,200 8,800 10,900 Add v Desired Ending Inventory 14,720 12,200 11,940 38,860 Total Needs 25,620 23,400 20,740 69,760 Less Beginning Inventory