Suppose you are the production manager in Goodman Company. The cost record and financial information are given in Table 1. You are going to make a budget on sales volume of 500 units and ending inventories of 50 units for next year. Moreover, you are granted a loan of $7,200 from a bank, and must repay at the end of next year, with an interest rate of 7% per annum. Opening cash Beginning inventories $9,000 30 units Raw materials Direct labour Manufacturing overhead $75 per unit $15 per unit Within 300 units: $1,300 in total Exceeding 300 units: $5 per extra unit Shop expense Salary of sales staff Administrative cost Purchase of equipment Depreciation of assets Table 1 $200 per month Basic: $500 per month Bonus: $5 per unit sold $2500 per month $6000 $900 (a) What are the production volume in units and production budget in dollars for next year? (3 marks) (6 marks) (b) If the net profit is budgeted to be $13,000, how much should be the selling price? (c) Determine the budgeted ending cash next year. (4 marks) (d) Suppose the senior management of the company is considering and evaluating another investment, which may affect the business plan as well as the manufacturing level. In this uncertainty, which budgeting approach should you use? (2 marks)