The following annual budget data relates to Navient Inc. for the year ending December 31, 2018.

	Item APP	Item ZAP
Sales budget:
Anticipated volume in units	400,000	250,000
Unit selling price	$23.00	$29.00
Production budget:
Desired ending finished goods units	27,000	20,000
Beginning finished goods units	34,000	11,000
Direct materials budget:
Direct materials per unit (pounds)	3	4
Desired ending direct materials pounds	35,000	16,000
Beginning direct materials pounds	43,000	12,000
Cost per pound	$4.00	$5.00
Direct labor budget:
Direct labor time per unit	0.4	0.6
Direct labor rate per hour	$14.00	$14.00
Budgeted income statement:
Total unit cost	$14.00	$22.00

A detailed selling and administrative expense budget shows selling expenses of $660,000 for product APP and $360,000 for product ZAP, and administrative expenses of $545,000 for product APP and $344,000 for product ZAP. Income taxes are expected to be 25%.

Instructions

Prepare the following budgets for the year. Show data for each product. .

(a) Sales

(b) Production

(c) Direct materials

(d) Direct labor

(e) Income statement (Note: Income taxes are not allocated to the products.)