Required Information Problem 9-42 Preparation of Master Budget (LO 9-3, 9-4, 9-5) [The following information applies to the questions displayed below.] FreshPak Corporation manufactures two types of cardboard boxes used in shipping canned food, fruit and vegetables. The canned food box (type C) and the perishable food box (type P) have the following material and labor requirements. Type of Box Direct material required per 100 boxes: Paperboard ($2.36 per pound) Corrugating medium ($0.18 per pound) Direct labor required per 100 boxes ($18.00 per hour) 25 pounds 15 pounds 0.40 hour 65 pounds 25 pounds @.80 hour The following production-overhead costs are anticipated for the next year. The predetermined overhead rate is based on a production volume of 415,000 units for each type of box. Production overhead is applied on the basis of direct-labor hours. Indirect material Indirect labor Utilities Property taxes Insurance Depreciation Total $ 12,600 89,520 36, eee 24, eee 19, eee 38,80 $219, 120 The following selling and administrative expenses are anticipated for the next year. Salaries and fringe benefits of sales personnel Advertising Management salaries and fringe benefits Clerical wages and fringe benefits Miscellaneous administrative expenses Total $120,000 25, eee 140, eee 41,5ee 6,500 $333,eee The sales forecast for the next year is as follows: Box type C Box type P Sales Volume 420,000 boxes 429,80 boxes Sales Price $140.00 per hundred boxes 200.ee per hundred boxes The following Inventory Information is available for the next year. The unit production costs for each product are expected to be the same this year and next year. Expected Inventory January 1 Desired Ending Inventory December 31 15, eee boxes 25, eee boxes 10, eee boxes 20, eee boxes Finished goods: Box type C Box type P Raw material: Paperboard Corrugating medium 17,580 pounds 7,580 pounds 7,5e0 pounds 12,5e9 pounds Prepare a master budget for FreshPak Corporation for the next year. Assume an Income tax rate of 35 percent. Problem 9-42 Part 7 7. Prepare the budgeted Income statement for the next year. (Do not round Intermediate calculations.) S 1.428,000 Sales revenue Less: Cost of goods sold Gross margin Selling and administrative expenses Income before taxes Income tax expense Net income 333.000