Problem 7-4A (Algo) Manufacturing: Preparation of a complete master budget LO P1, P2, P3 The management of Zigby Manufacturing prepared the following balance sheet for March 31 ZIGBY MANUFACTURING Balance Sheet March 31 Assets Liabilities and Equity Cash $ 46,000 Liabilities Accounts receivable 393,960 Accounts payable Raw materials inventory 96,300 Loan payable Finished goods inventory 327,831 Long-tern note payable Equipment $ 612,000 Equity Less: Accumulated depreciation 156,000 456,000 Common stock Retained earnings Total assets $ 1,320,091 Total liabilities and equity To prepare a master budget for April May, and June, management gathers the following information $ 196,200 18, eee 500,000 $ 714,200 341,000 264,891 605, 891 $ 1,320,092 materials, a. Sales for March total 20,100 units. Budgeted sales in units follow: April, 20,100; May, 18,900: June, 19700; and July, 20100 The product's selling price is $28.00 per unit and its total product cost is $23.30 per unit. b. Raw materials inventory consists solely of direct materials that cost $20 per pound. Company policy calls for a given month's ending materials inventory to equal 50% of the next month's direct materiais requirements. The March 31 raw materials inventory is 4,815 pounds. The budgeted June 30 ending raw materials inventory is 4,600 pounds. Each finished unit requires 0.50 pound of direct c Company policy calls for a given month's ending finished goods Inventory to equal 70% of the next month's budgeted unit sales The March 31 finished goods Inventory is 14,070 units. d. Each finished unit requires 0.50 hour of direct labor at a rate of $21 per hour. e. The predetermined variable overhead rate is $3.00 per direct labor hour. Depreciation of $25,437 per month is the only fixed factory overhead item 1. Sales commissions of 6% of sales are paid in the month of the sales. The sales manager's monthly salary is $3,600 9. Monthly general and administrative expenses include $18,000 for administrative salaries and 0.5% monthly interest on the long