Shadee Corp. expects to sell 540 sun visors in May and 350 in June. Each visor sells for $31. Shadees beginning and ending finished goods inventories for May are 70 and 45 units, respectively. Ending finished goods inventory for June will be 60 units.

Each visor requires a total of $4.50 in direct materials that includes an adjustable closure that the company purchases from a supplier at a cost of $2.50 each. Shadee wants to have 31 closures on hand on May 1, 19 closures on May 31, and 21 closures on June 30. Additionally, Shadees fixed manufacturing overhead is $1,100 per month, and variable manufacturing overhead is $1.25 per unit product.

1. Determine Shadee's budgeted cost of closures purchased for May and June.

2. Determine Shadee's budget manufacturing overhead for May and June.

Suppose that each visor takes 0.80 direct labor hours to produce and Shadee pays its workers $10 per hour.

Determine Shadee's budgeted direct labor cost for May and June. (Do not round your intermediate values. Round your answers to 2 decimal places.)

1. Determine Shadees budgeted manufacturing cost per visor. (Note: Assume that fixed overhead per unit is $7.)

2. Compute the Shadees budgeted cost of goods sold for May and June.

Additional information:

• Selling costs are expected to be 9 percent of sales.
• Fixed administrative expenses per month total $1,600.

Determine Shadee's budgeted selling and administrative expenses for May and June. (Do not round your intermediate calculations. Round your answers to 2 decimal places.

Complete Shadee's budgeted income statement for the months of May and June. (Note: Assume that fixed overhead per unit is $7.00.) (Do not round your intermediate calculations. Round your answers to 2 decimal places.)

SHADEE CORP.
Budgeted Income Statement
	May	June
Budgeted Gross Margin
Budgeted Net Operating Income