Hoyce Corporation prepares monthly operating and financial budgets. The operating budgets for June and July are based on the following data: Units Units Produced Sold June 400,000 360,000 July 360,000 400,000 All sales are at $30 per unit. Direct material, direct labor, and variable manufacturing overhead are estimated at $3, $6, and $3 per unit, respectively. Total fixed manufacturing overhead is budgeted at $1,080,000 per month. Monthly selling and administrative expenses are budgeted at $1,200,000 plus 10% of sales, while income taxes are budgeted at 35% of income before taxes. The inventory at June 1 consists of 200,000 units with a cost of $17.10 each Required: A. Prepare monthly budget estimates of cost of goods sold assuming the FIFO inventory procedure is used. B. Prepare planned operating budgets for June and July. Hoyce Corporation Planned Production and Cost of Goods Sold For June and July June 400,000 July 360,000 Planned production (units) Beginning inventory--June 1: Beginning inventory--July 1: Planned production costs: Materials Direct labor Variable overhead Fixed overhead Total production costs Goods available for sale Ending inventory-- June 30: Ending inventory--July 31: Cost of goods sold Hoyce Corporation Planned Operating Budgets For June and July June July Sales Cost of goods sold Gross margin Selling and admin expenses Income before taxes Less: Income taxes Net income