Great Biking Company manufactures a unique model of bicycle helmet. The company began operations January 1, 2020. Its accountant quit one week ago and they are asking for your advice.It is now November 1, 2020 and they are planning for the December 2020 production month.

They are anticipating sales of 25,000 bicycle helmets in December 2020 at a selling price of $325 each.They have 7,500 units in inventory and at the end of December 2020 they only want to have 2,500 bicycle helmets on hand.

Each bicycle helmet uses 6 units of direct materials in production at a cost of $15 per unit.Currently there are 15,000 units of direct materials on hand and at the end of December 2020 the company would like to have 25,000 units of direct materials on hand.

It takes 3 direct labour hours to produce one helmet at a cost of $25.00 per hour.Factory overhead is applied at the rate of 80% of the direct labour cost.

The following manufacturing expenses are expected to be incurred during December 2020.

Property Taxes - Manufacturing Building

35,500.00

Insurance - Manufacturing

25,600.00

Utilities

85,000.00

Machinery Repairs and Maintenance

35,800.00

Manufacturing Building Repairs and Maintenance

25,700.00

Indirect Materials

25,600.00

Depreciation on Manufacturing Building

34,800.00

Depreciation on Manufacturing Equipment

75,000.00

Supervisor Salaries

57,000.00

Required

a)Prepare sales budget.

b)Prepared production budget.

c)Prepare direct materials budget.

d)Prepare direct labour budget.

e)Prepare factory overhead budget.

f)Prepare schedule detailing out the unit cost.

g)Prepare budgeted Income Statement.