Preparation of Individual Budgets During the first calendar quarter of 2016, Clinton Corporation is planning to manufacture a new product and introduce it in two regions. Market research indicates that sales will be 5,000 units in the urban region at a unit price of $53 and 4,000 units in the rural region at $48 each. Because the sales manager expects the product to catch on, he has asked for production sufficient to generate a 3,000-unit ending inventory. The production manager has furnished the following estimates related to manufacturing costs and operating expenses: Variable Fixed (per unit) (total) Manufacturing costs: Direct materials $12.60 9.30 7.50 A (4 lb. @ $3.15/lb.) B (2 lb. @$4.65/lb.) Direct labor (0.5 hours per unit) Manufacturing overhead: Depreciation Factory supplies Supervisory salaries Other $%7,650 0.90 4,500 - 28,800 0.75 22,950 Operating expenses: Selling: Advertising Sales salaries & commissions* Other 22,500 1.50 15,000 0.90 3,000 Administrative Office salaries Supplies Other 2,700 0.15 1,050 0.08 1,950 *Varies per unit sold, not per unit produced a. Assuming that the desired ending inventories of materials A and B are 3,000 and 5,000 pounds, respectively, and that work-in-process inventories are immaterial, prepare budgets for the calendar quarter in which the new product will be introduced for each of the following operating factors: Do not use negative signs with any of your answers below 1. Total sales 457,000 V 2. Production 12,000units