Inventory, purchases, and cost of goods sold budget

Preston, Inc. manufactures model airplane kits and projects production at 450, 420, 200, and 500 kits for the next four quarters. (Click the icon to view the manufacturing information.) Prepare Preston's direct materials budget, direct labor budget, and manufacturing overhead budget for the year. Round the direct labor hours needed for production, budgeted overhead costs, and predetermined overhead allocation rate to two decimal places. Round other amounts to the nearest whole number. Begin by preparing Preston's direct materials budget. Preston, Inc. Direct Materials Budget For the Year Ended December 31 First Second Third Fourth Quarter Quarter Quarter Quarter Total Direct materials (ounces) per Lid Begin by preparing Preston's direct materials budget. Preston, Inc. Direct Materials Budget For the Year Ended December 31 First Second Third Fourth Quarter Quarter Quarter Quarter Total Budgeted kits to be produced Direct materials (ounces) per kit Direct materials needed for production Plus: Desired direct materials in ending inventory Total direct materials needed Less: Direct materials in beginning inventory Budgeted purchases of direct materials Direct materials cost per ounce Budgeted cost of direct materials purchases Direct Labor Budget For the Year Ended December 31 First Second Third Quarter Quarter Quarter Fourth Quarter Total Direct labor hours needed for production Budgeted direct labor cost Prepare the manufacturing overheabudget. (Enter all costs and hours as a decimal to two places. XXX. Abbreviations used: VOH = variable manufacturing overhead; FOH = fixed manufacturing overhead.) Manufacturing Overhead Budget For the Year Ended December 31 First Second Third Quarter Quarter Quarter Fourth Quarter Total VOH cost per kit Budgeted VOH Budgeted FOH Budgeted manufacturing overhead costs Direct labor hours Budgeted manufacturing overhead costs Predetermined overhead allocation rate Direct materials are six ounces of plastic per kit and the plastic costs $3 per ounce. Indirect materials are considered insignificant and are not included in the budgeting process. Beginning Raw Materials Inventory is 870 ounces, and the company desires to end each quarter with 20% of the materials needed for the next quarter's production. Preston desires a balance of 290 ounces in Raw Materials Inventory at the end of the fourth quarter. Each kit requires 0.25 hours of direct labor at an average cost of $40 per hour. Manufacturing overhead is allocated using direct labor hours as the allocation base. Variable overhead is $0.90 per kit, and fixed overhead is $160 per quarter