MCO Leather manufactures leather purses. Each purse requires 2 pounds of direct materials at a cost of $4 per pound and 0.7 direct labor hours at a rate of $15 per hour. Variable manufacturing overhead is charged at a rate of $3 per direct labor hour. Fixed manufacturing overhead is $11,000 per month. The company's policy is to end each month with direct materials inventory equal to 40% of the next month's materials requirement. At the end of August the company had 4,480 pounds of direct materials in inventory. The company's production budget reports the following. (1) Prepare direct materials budgets for September and October. (2) Prepare direct labor budgets for September and October. (3) Prepare factory overhead budgets for September and October. MCO Leather Direct Materials Budget For the Months of September and October \begin{tabular}{|l|l|} \hline Budgeted production (units) \\ \hline Materials requirements per unit (lbs.) & \\ \hline Materials needed for production (lbs.) & \\ \hline Budgeted ending inventory (lbs.) & \\ \hline Total materials requirements (lbs.) & \\ \hline Budgeted beginning inventory (lbs.) & \\ \hline Materials to be purchased (lbs.) & \\ \hline Direct material cost per lb. & \\ \hline Total budgeted direct materials & \\ \hline \end{tabular} MCO Leather Direct Labor Budget For the Months of September and October \begin{tabular}{|l|l|l|} \hline & \multicolumn{1}{|c|}{ September } & October \\ \hline Budgeted production (units) & & \\ \hline DL hours required per unit & & \\ \hline Total direct labor hours needed & & \\ \hline Direct labor rate per hour & & \\ \hline Total budgeted direct labor & & \\ \hline \end{tabular} MCO Leather Factory Overhead Budget For the Months of September and October \begin{tabular}{|l|l|} \hline Total direct labor hours needed \\ \hline VOH rate per DL hour & \\ \hline Budgeted variable overhead \\ \hline Budgeted fixed overhead & \\ \hline \end{tabular}