LBL Corporation is preparing its master budget for the first quarter of the upcoming year. The following contains detail on LBLs operations necessary for their master budget:

LBL Corporation is preparing its master budget for the first quarter of the upcoming year. The following contains detail on LBL's operations necessary for their master budget: Sales Information: o Actual / Projected Sales are as follows: : December (Prior Year; Actual): $75,000 January (Estimated): $85,000 February (Estimated): $91,000 March (Estimated): $96,000 . April (Estimated): $112,000 . May (Estimated): $120,000 o Units are sold at $11 each o Sales in a month are paid in cash for 40% and on credit for the remainder with credit collection occurring in the month following the sale. HINT: To help you with several budgets, you will need sales in UNITS (not total dollars as listed above). You can calculate the number of sales units by taking the total sales / sales price per unit. Partial balance sheet as of 12/31 of the prior year: o Cash $5,050 0 A/R, net $112,000 O Inventory $37,600 o PP&E $145,000 O A/P $35,700 o Capital Stock $140,900 o Retained Earnings $29,000 HINT: You may not need all this information. LBL plans to produce enough units for sales expected in the period as well as have a cushion in ending finished goods inventory of 20% of the following month's sales units expected. Direct Materials: Three pounds of materials are needed to create each unit. o When LBL purchases raw materials, they pay 30% in the month of purchase and the rest the following month. The cost is $1.50 per pound of material. o Management wants ending inventory to be equal to 20% of next month's production needs. HINT: Direct materials are the only thing that LBL pays for, in part, in the following month. All other expenses are paid for in the month they occur. Therefore, the balance for A/P is for raw materials. HINT: The Fixed MOH per unit was given to you. 8. Budgeted income statement for the quarter ending March 31 (Hint 1: This is a quarterly statement, so you do not need to do each month but rather a combined statement for January 1 through March 31; Hint 2: The COGS amount is found, in part, by using the COGS per unit you find in budget 7. above)