Required information

[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
	C				P
Direct material required per 100 boxes:
Paperboard ($0.40 per pound)		35	pounds			75	pounds
Corrugating medium ($0.20 per pound)		25	pounds			35	pounds
Direct labor required per 100 boxes ($20.00 per hour)		0.20	hour			0.40	hour

The following production-overhead costs are anticipated for the next year. The predetermined overhead rate is based on a production volume of 425,000 units for each type of box. Production overhead is applied on the basis of direct-labor hours.

Indirect material	$	12,900
Indirect labor		54,600
Utilities		33,000
Property taxes		22,000
Insurance		15,000
Depreciation		41,000
Total	$	178,500

The following selling and administrative expenses are anticipated for the next year.

Salaries and fringe benefits of sales personnel	$	123,000
Advertising		26,000
Management salaries and fringe benefits		142,000
Clerical wages and fringe benefits		42,500
Miscellaneous administrative expenses		6,700
Total	$	340,200

The sales forecast for the next year is as follows:

	Sales Volume				Sales Price
Box type C		430,000	boxes		$	115.00	per hundred boxes
Box type P		430,000	boxes			175.00	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
Finished goods:
Box type C	17,000	boxes		12,000	boxes
Box type P	27,000	boxes		22,000	boxes
Raw material:
Paperboard	18,500	pounds		8,500	pounds
Corrugating medium	8,500	pounds		13,500	pounds

Prepare a master budget for FreshPak Corporation for the next year. Assume an income tax rate of 30 percent.

5. Prepare the production-overhead budget for the next year.

Total production overhead $ 0