Juicy Lemonade Company The Juicy Lemonade Company manufactures premium flavored organic lemonade. Management is ready to close the books for the end of the first quarter in 2019 and your supervisor has presented you with the following information. a. Total sales in gallons of flavored lemonade for January 2019 through March 2019 are as follows: January 10,000 February 12,000 March 14,000 Each gallon of lemonade is packaged in eight 16 ounce bottles and sold in a case that sells for $15.00 per case. The company produced 37,500 units during the first quarter of 2019. b. The companys Variable Costs include the following Direct Materials of $3.25 per gallon Direct Labor of $2 per gallon (Each gallon of lemonade requires 15 minutes of direct labor time and the wage rate is $8 per hour) Variable MOH $ 1.5 per gallon (The variable overhead rate is $2.00 per machine hour and processing one gallon of lemonade takes 45 minutes of machine time) Variable Selling and Administrative costs of $1.25 per gallon c. The companys Fixed Costs for the quarter include the following: Manufacturing Overhead $37,500 Selling and Administrative $26,900 The companys fixed manufacturing overhead per gallon is $1 _. (The Fixed Manufacturing Overhead rate is based on Fixed Costs for the quarter and the units produced for the quarter.) d. The companys manufacturing overhead is applied based on the number of gallons produced using the Variable Manufacturing Overhead Rate per gallon calculated in b and the Fixed Manufacturing Overhead Rate per gallon calculated in c. e. Raw Materials Inventory consists entirely of direct materials and, at the beginning of the year, consists of 700 units of direct material at a cost of $3.25 per unit. The company purchased 38,000 units of direct material at a cost of $3.25 per unit. Each gallon of lemonade requires one unit of direct materials. f. Beginning Work in process inventory consists of 500 gallons of partially processed lemonade. All raw materials are added at the beginning of the production process and these partially completed units are 60% complete with respect to conversion costs. Ending work in process consists of 800 gallons of partially processed lemonade that are 40% complete with respect to conversion costs. The company completed and transferred out 37,500 units this quarter. The beginning work in process and current period costs are as follows Beginning WIP Direct Materials $1,625 Conversion Costs $450 Current period Costs Direct Materials $129,675 Conversion Costs $168,750 g. There are 300 gallons of lemonade in Finished Goods Inventory at the beginning of the year carried at a cost of $7.75. There are 1,800 gallons in ending Finished Goods Inventory carried at a cost of $7.75 per unit. You are required to prepare all of the following 1. A Production Cost Report using both the weighted average and FIFO methods of assigning costs to goods transferred out and ending inventory. 2. Schedule of Cost of Goods Manufactured and a Schedule of Cost of Goods Sold using both methods of assigning costs to goods transferred out and ending inventory. 3. Gross Margin and Contribution Margin Income Statements (HINT: For the Gross Margin Income Statement, Total Cost of Goods Sold should be equal to the Cost of Goods Sold calculated based on the FIFO method of assigning costs to goods transferred out and ending inventory). 4. A Break-Even Analysis that includes all of the following components (HINT: Use the information in parts a, b, and c for your calculations) a. Break-Even in gallons and dollars b. Target Profit in gallons and dollars if the company wants a net operating income of $250,000 after taxes. The tax rate is 20%. c. Margin of Safety expressed in dollars, units, and as a percentage of sales