The BestCrackers company produces and sells organic garlic crackers. The one- pound family size bag of crackers has two direct materials - flour and packaging. The production process includes making, rolling and cutting dough, and baking the crackers. Indirect materials include a small amount of garlic powder, sugar, salt, butter, and olive oil. BestCrackers is preparing budgets for the fourth quarter ending December 31, 2021. For each requirement below prepare budgets by month for October, November, and December, and a total budget for the quarter. 1. The previous year's sales (2020/21) for the corresponding period were: October 60,520 bags November 65,010 bags December 81,170 bags January 73,550 bags February 62,300 bags The company expects the above volume of sales to increase by 10% for the period October 2021 - February 2022. The budgeted selling price for 2021 is $8.50 per bag of crackers. The company expects 30% of its sales to be cash (COD) sales. The remaining 70% of sales will be made on credit. Prepare a Sales Budget for BestCrackers. 2. The company desires to have finished goods inventory on hand at the end of each month equal to 10 percent of the following month's budgeted unit sales. On September 30, 2021, BestCrackers expects to have 6,500 bags of crackers on hand. (Note: an estimate of sales in January is required in order to complete the production budget for December). Use the @ROUNDUP function to round up to the nearest whole number the number of cracker bags desired in ending inventory. Prepare a Production budget 3. The final product (bags of crackers) requires two direct materials: flour and packaging. Flour 1.5 pounds of flour are required for each bag of crackers. Management desires to have materials on hand (i.e., pounds of flour) at the end of each month equal to 20 percent of the following month's production needs. Use the @ROUNDUP function to round up to the nearest whole number the number of pounds of flour desired in ending inventory. The beginning materials inventory in October 2021, is expected to be 20,804 pounds. Flour costs $0.33 per pound. Flour is only allowed to be purchased in whole pounds, so use the @ROUNDUP function to round up to the nearest whole number the number of pounds to purchase). Packaging Packaging material is purchased by the roll and 25 bags of crackers are produced from each roll. The packaging is made from biodegradable, organic plant fiber that extends the shelf life of the crackers while preserving its freshness. Management desires to have packaging on hand at the end of each month equal to 15 percent of the following month's production needs. Use the @ROUNDUP function to round up to the nearest whole number the number of rolls desired in ending inventory. The beginning inventory of packaging (i.e., rolls of packaging material) in October 2021 is expected to be 355 rolls. Packaging is expected to cost $11 per roll. Use the @ROUNDUP function to round up to the nearest whole number the number of rolls to purchase. Prepare a Direct Materials budget. (Note: budgeted production in January is required in order to complete the direct materials budget for December. Because two direct materials are required for production - flour and rolls of packaging - you will need a separate schedule for each direct material.) 4. Each bag of crackers requires 0.20 hours of direct labor. Each hour of direct labor costs the company $16. Prepare a Direct Labor budget. 5. BestCrackers budgets indirect materials (e.g.. garlic powder, salt, oil) at $0.20 per bag. BestCrackers treats indirect labor and utilities as mixed costs. The variable components are $0.40 per bag for indirect labor and $0.20 per bag for utilities. The following fixed costs per month are budgeted for indirect labor, $15,000, utilities, $3,500, and other, $8,000. Prepare a Manufacturing Overhead budget. 6. Variable selling and administrative expenses are $1.10 per bag of crackers sold. Fixed selling and administrative expenses include administration ($38,000 per month) and marketing ($5,000 per month). Prepare an Operating Expenses budget. 7. Prepare a Budgeted Manufacturing Cost per unit budget. Refer to exhibit 9-11 for guidance. To calculate FMOH/unit calculate total FMOH for the year and divide this by budgeted production for the year. The total production volume for the year is budgeted at 775,000 bags. 8. Prepare a Budgeted Income Statement for the quarter for BestCrackers. Assume interest expense of $0, and income tax expense of 24% of income before taxes. The BestCrackers company produces and sells organic garlic crackers. The one- pound family size bag of crackers has two direct materials - flour and packaging. The production process includes making, rolling and cutting dough, and baking the crackers. Indirect materials include a small amount of garlic powder, sugar, salt, butter, and olive oil. BestCrackers is preparing budgets for the fourth quarter ending December 31, 2021. For each requirement below prepare budgets by month for October, November, and December, and a total budget for the quarter. 1. The previous year's sales (2020/21) for the corresponding period were: October 60,520 bags November 65,010 bags December 81,170 bags January 73,550 bags February 62,300 bags The company expects the above volume of sales to increase by 10% for the period October 2021 - February 2022. The budgeted selling price for 2021 is $8.50 per bag of crackers. The company expects 30% of its sales to be cash (COD) sales. The remaining 70% of sales will be made on credit. Prepare a Sales Budget for BestCrackers. 2. The company desires to have finished goods inventory on hand at the end of each month equal to 10 percent of the following month's budgeted unit sales. On September 30, 2021, BestCrackers expects to have 6,500 bags of crackers on hand. (Note: an estimate of sales in January is required in order to complete the production budget for December). Use the @ROUNDUP function to round up to the nearest whole number the number of cracker bags desired in ending inventory. Prepare a Production budget 3. The final product (bags of crackers) requires two direct materials: flour and packaging. Flour 1.5 pounds of flour are required for each bag of crackers. Management desires to have materials on hand (i.e., pounds of flour) at the end of each month equal to 20 percent of the following month's production needs. Use the @ROUNDUP function to round up to the nearest whole number the number of pounds of flour desired in ending inventory. The beginning materials inventory in October 2021, is expected to be 20,804 pounds. Flour costs $0.33 per pound. Flour is only allowed to be purchased in whole pounds, so use the @ROUNDUP function to round up to the nearest whole number the number of pounds to purchase). Packaging Packaging material is purchased by the roll and 25 bags of crackers are produced from each roll. The packaging is made from biodegradable, organic plant fiber that extends the shelf life of the crackers while preserving its freshness. Management desires to have packaging on hand at the end of each month equal to 15 percent of the following month's production needs. Use the @ROUNDUP function to round up to the nearest whole number the number of rolls desired in ending inventory. The beginning inventory of packaging (i.e., rolls of packaging material) in October 2021 is expected to be 355 rolls. Packaging is expected to cost $11 per roll. Use the @ROUNDUP function to round up to the nearest whole number the number of rolls to purchase. Prepare a Direct Materials budget. (Note: budgeted production in January is required in order to complete the direct materials budget for December. Because two direct materials are required for production - flour and rolls of packaging - you will need a separate schedule for each direct material.) 4. Each bag of crackers requires 0.20 hours of direct labor. Each hour of direct labor costs the company $16. Prepare a Direct Labor budget. 5. BestCrackers budgets indirect materials (e.g.. garlic powder, salt, oil) at $0.20 per bag. BestCrackers treats indirect labor and utilities as mixed costs. The variable components are $0.40 per bag for indirect labor and $0.20 per bag for utilities. The following fixed costs per month are budgeted for indirect labor, $15,000, utilities, $3,500, and other, $8,000. Prepare a Manufacturing Overhead budget. 6. Variable selling and administrative expenses are $1.10 per bag of crackers sold. Fixed selling and administrative expenses include administration ($38,000 per month) and marketing ($5,000 per month). Prepare an Operating Expenses budget. 7. Prepare a Budgeted Manufacturing Cost per unit budget. Refer to exhibit 9-11 for guidance. To calculate FMOH/unit calculate total FMOH for the year and divide this by budgeted production for the year. The total production volume for the year is budgeted at 775,000 bags. 8. Prepare a Budgeted Income Statement for the quarter for BestCrackers. Assume interest expense of $0, and income tax expense of 24% of income before taxes