QUESTION : 1 Golden Stars Company is preparing its master budget for 2020. Relevant data pertaining to its sales, production, and direct materials budgets are as follows: Sales: Sales for the year are expected to total 1,600,000 units. Quarterly sales are 30%, 20%, 30%, and 20% respectively. The sales price is expected to be $55 per unit for the first three quarters and $65 per unit beginning in the fourth quarter. Sales in the first quarter of 2021 are expected to be 15% higher than the budgeted sales for the first quarter of 2020. Production: Management desires to maintain ending finished goods inventories at 25% of next quarter's budgeted sales volume. Direct materials: Each unit requires 4 pounds of raw materials at a cost of $5 per pound. Management desires to maintain raw materials inventories at 5% of the next quarter's production requirements. Assume the production requirements for the first quarter of 2021 are 1,100,000 pounds. Direct Labour: Two hours of direct labor are required to produce each unit of finished goods. The anticipated hourly wage rate is $10. The manufacture of each product requires 3 pounds of raw materials, and the expected cost per pound is $5. Assume that the desired ending direct materials amount is 1,020 pounds for the fourth quarter of 2020. Beginning direct material is 620 pounds for the first quarter of 2020. Prepare the: - 1. Sales Budget 2. Production Budget 3. Direct materials Budget 4. Budget 5. Manufacturing Overhead Budget 6. Selling and Administrative Expense Budget