Jasmine Corp. manager is completing the budgetary planning for the first half of 2022. The Sales Manager has already completed the sales budget which the Production Manager utilized to prepare the production budget and direct materials budget.

The Production Manager has provided the following information and indicated that he was unable to complete the Direct Labour or Manufacturing Overhead Budgets before proceeding on annual vacation, as he was awaiting costing data. The Finance Manager has been able to acquire the costing data.

All relevant data are as follows:

Units to be produced:

Quarter 1: 10,000

Quarter 2: 12,000

Direct labor: 1 hour per unit at a rate of:

$12 per hour for the first 10,000 labour hours; and

$15 per hour for any time above 10,000 hours per quarter (considered overtime).

Variable overhead costs per direct labor hour Fixed overhead costs per quarter

indirect material $0.80 Supervisory salaries $42 000

indirect labor $1.20 Depreciation $16 000

maintenance $0.50 Maintenance $12 000

Required:

a) Prepare the Direct Labour Budget for the year, showing quarterly data.

b) Prepare the Manufacturing Overhead Budget for the year, showing quarterly data.