OBJECTIVE 2 CORNERSTONE 9.2 56,000 Cornerstone Exercise 9-2 Preparing a Production Budget Memorsave Inc, makes and sells picture frames. From July to October of the coming year, Memor- save expects the following unit sales: July August 39,000 September 61,000 October 55.000 Memorsave's policy is to have 30 percent of next month's sales in ending inventory. On July 1, it is expected that there will be 7,400 units on hand. Required: Prepare a production budget for the third quarter of the year. Show the number of frames that should be produced each month as well as for the quarter in total. OBJECTIVE 2 CORNERSTONE Cornerstone Exercise 9-4 Preparing a Direct Materials Purchases Budget Selva Inc. makes keyboards for tablets, and packages them in crates containing 50 keyboards per crate. Planned production in units for the first three months of the coming year is: January 43,800 February 41,000 March 50,250 Each keyboard requires two litres of chemicals and one plastic crate Company policy requires that ending inventories of raw materials for each month be 15 percent of the next month's produc- tion needs. That policy was met for the ending inventory of December in the prior year. The cost of one litre of chemicals is $0.50. The cost of one crate is $1.60. (Note: Round all dollar amounts to the nearest dollar.) Required: 1. Calculate the ending inventory of chemicals in litres for December of the prior year, and for January and February. What is the beginning inventory of chemicals for January? 2. Prepare a direct materials purchases budget for chemicals for the months of January and February 3. Calculate the ending inventory of crates for December of the prior year, and for January and February. What is the beginning inventory of crates for January? 4. Prepare a direct materials purchases budget for crates for the months of January and February OBJECTIVE CORNERSTONE 9.9 Cornerstone Exercise 9.9 Preparing a Selling and Administrative Expenses Budget Fael Company makes and sells paper products. In the coming year, Fael expects total sales of $19.730,000. There is a 3 percent commission on sales. In addition, fixed expenses of the sales and administrative offices include the following Salaries $ 960.000 Utilities 365,000 Office space 230.000 Advertising 1.200.000 Required: Prepare a selling and administrative expenses budget for Fuel Company for the coming year. OBJECTIVE CORNERSTONE 9.12 Cornerstone Exercise 9-12 Preparing an Accounts Payable Schedule Demir Inc, purchases raw materials on account for use in production. The direct materials pur- chases budget shows the following expected purchases on account: April 5374.400 May 411,200 416,000 Demir typically pays 20 percent on account in the month of billing and 80 percent in the next month. Required: 1. How much cash is required for payments on account in May! 2. How much cash is expected for payments on tccount in June? June