The production department of Zan Corporation has submitted the following forecast of units to be produced by quarter for the upcoming fiscal year:

	1st Quarter	2nd Quarter	3rd Quarter	4th Quarter
Units to be produced	10,000	13,000	12,000	11,000

In addition, 20,000 grams of raw materials inventory is on hand at the start of the 1st Quarter and the beginning accounts payable for the 1st Quarter is $5,800.

Each unit requires 8 grams of raw material that costs $1.40 per gram. Management desires to end each quarter with an inventory of raw materials equal to 25% of the following quarters production needs. The desired ending inventory for the 4th Quarter is 7,000 grams. Management plans to pay for 60% of raw material purchases in the quarter acquired and 40% in the following quarter. Each unit requires 0.40 direct labor-hours and direct laborers are paid $11.50 per hour.

Required:

1-a.

Prepare the companys direct materials budget for the upcoming fiscal year. (Round "Unit cost of raw materials" answers to 2 decimal places.)

Zan Corporation
Direct Materials Budget
	1st	2nd	3rd	4th
	Quarter	Quarter	Quarter	Quarter	Year
Required production in units of finished goods	10,000	13,000	12,000	11,000	46,000
Units of raw materials needed per unit of finished goods	8	8	8	8	8
Units of raw materials needed to meet production	80,000	104,000	96,000	88,000	368,000
Add: Desired units of ending raw materials inventory	26,000	24,000	22,000	7,000	7,000
Total units of raw materials needed	106,000	128,000	118,000	95,000	375,000
Less: Units of beginning raw materials inventory
Units of raw materials to be purchased	106,000	128,000	118,000	95,000	375,000
Unit cost of raw materials	$1.40	$1.40	$1.40	$1.40	$1.40
Cost of raw materials to be purchased	$148,400	$179,200	$165,200	$133,000	$525,000

1-b.

Prepare a schedule of expected cash disbursements for purchases of materials for the upcoming fiscal year.

Zan Corporation
Schedule of Expected Cash Disbursements for Materials
	1st	2nd	3rd	4th
	Quarter	Quarter	Quarter	Quarter	Year
Beginning accounts payable					$0
1st Quarter purchases					0
2nd Quarter purchases					0
3rd Quarter purchases					0
4th Quarter purchases					0
Total cash disbursements for materials	$0	$0	$0	$0	$0

2.

Prepare the companys direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced. (Round "Direct labor-hours per unit" and "Direct labor cost per hour" answers to 2 decimal places.)

Zan Corporation
Direct Labor Budget
	1st	2nd	3rd	4th
	Quarter	Quarter	Quarter	Quarter	Year
Required production in units
Direct labor-hours per unit
Total direct labor-hours needed
Direct labor cost per hour
Total direct labor cost