Packers sells its rock-climbing shoes worldwide. Packers expects to sell 8,000 pairs of shoes for $175 each in January, and 2,000 pairs of shoes for $220 each in February. Packers' production cost per pair of shoes is budgeted at $85 in direct materials cost, $56 in direct labor cost, and $24 in variable manufacturing overhead cost per shoe. Additionally, its monthly fixed overhead budget is $26,000 of which $4,000 represents depreciation, and the company expects to sell 4,300 pairs of shoes in March for $290 each. Packers has no beginning finished goods inventory for the first quarter but desires ending finished goods inventory to be 40% of the following months' sales. Packers maintains no direct materials inventory. April sales are projected to be 8,000 pairs of shoes. Selling and administrative expenses total $5,100 per month.

Sales Budget

January February Total

Sales price per pair $175 $220

Number of pairs 8,000 2,000

Total sales $1,400,000 $440,000 $1,840,000

Requirement

1.	Use this information and the sales budget to prepare Packers'production budget, direct materials budget, direct labor budget, and manufacturing overhead budget for January, February, and March.