P7-2 Sales, production, direct materials, direct labor, and factory overhead budgets similar to Self Problem1 Cruise Tire Company's budgeted unit sales for the year 2011 were: Passenger car tires. Truck tires 120.000 25.000 The budgeted selling price for truck tires was $200 per tire, and that for passenger car tires was $65 per tire. The beginning finished goods inventories were expected to be 2,000 truck tires and 5,000 passenger tires, for a total cost of $326,478, with desired ending inventories at 2,500 and 6,000, respectively, with a total cost of $400,510. There was no anticipated beginning or ending work in process inventory for either type of tire. The standard materials quantities for each type of tire were as follows: Rubber Steel belts Truck 30 lb Passenger Car 10 The purchase prices of rubber and steel were $2 and $3 per pound, respectively. The desired ending inventories for rubber and steel were 60,000 and 6,000 pounds, respectively. The estimated beginning inventories for rubber and steel were 75,000 and 7,000 pounds, respectively. The direct labor hours required for each type of tire were as follows: Truck tire Passenger car tire Molding Department Finishing Department 0.25 0.15 0.10 0.05 The direct labor rate for each department is as follows: Molding Department. Finishing Department. $15 per hour $13 per hour Chapter 7-The Master Budget and Flexible Budgeting 373 Budgeted factory overhead costs for 2011 were as follows: Indirect materials. Indirect labor Depreciation of building and equipment Power and light Total $19500 213.200 157,500 122,900 $93.100 Required: Prepare each of the following budgets for Cruise for the year ended 2011: 1. Sales budget. 2. Production budget. 3. Direct material budget. 4. Direct labor budget. 5. Factory overhead budget. 6. Cost of goods sold budget.