Required: 1. Prepare a production budget and a directlabor budget for Spiffy Shades Corporation by month and for the first quarter of 20x1. [Round "Direct-labor hours per unit" to 2 decimal placesJ 18,000 211,000 16,000 54,000 E __ Total needs Units to be produced Direct-labor hours per unit Total hours of direct labor lime needed Direct-labor costs: We ges Pension contributions Workers compensation insurance Employee medical insurance Employer's social security Total direct-labor cost Required information [The foiiowing information applies to the questions dispiayeo' below] Spiffy Shades Corporation manufactures artistic frames for sunglasses. Talia Demarest, controller, is responsible for preparing the company's master budget. In compiling the budget data for 20x1, Demarest has learned that new automated production equipment will be installed on March 1. This will reduce the direct labor per frame from 4.0 hours to 3.75 hours. Labor-related costs include pension contributions of $0.55 per hour, workers' compensation insurance of $0.25 per hour, employee medical insurance of $1 per hour, and employer contributions to Social Security equal to 6.00 percent of direct labor wages. The cost of employee benets paid by the company on its employees is treated as a directlabor cost. Spiffy Shades Corporation has a labor contract that calls for a wage increase to $13.00 per hour on April 1, 20x1. Management expects to have 26,000 frames on hand at December 31. 203-40. and has a policy of carrying an end-ofmonth inventory of 100 percent of the following months sales plus 40 percent ofthe second following month's sales. These and other data compiled by Demarest are summarized in the following table. Januaryr Februaryr March April Pi'layr Directlabor hours per unit 4.6 4.6 3.75 3.75 3.75 wage per directlabor hour $ 11.66 $ 11.66 $ 11.66 $ 13.66 $ 13.66 Estimated unit sales 16,666 26,666 16,666 17,666 17,666 Sales price per unit $ 64.66 $ 61.56 $ 61.56 $ 61.56 $ 61.56 Production overhead: Shipping and handling {per unit sold} $ 5.66 $ 5.66 $ 5.66 $ 5.66 $ 5.66 Purchasing, material handling, and inspection (per unit produced} $ 6.66 $ 6.66 $ 6.66 $ 6.66 $ 6.66 Other production overhead (per directlabor hour) $ 9.66 $ 9.66 $ 9.66 $ 9.66 $ 9.66 Required: 1. Prepare a production budget and a direct-labor budget for Spiffy Shades Corporation by month and for the first quarter of 20x1. [Round \"Direct-labor hours per uriitrr to Zdecimal places.)