Waterway Corporation 5 ales ludget For the First Quarter of 20x Waterway Corporation Production Budget For the First Quarter of 20wx (This is a continuation of the Waterways Problem from Chapters I through 8.) WCp9 Waterways Corporation is preparing its budget for the coming year, 2014. The first step is to plan for the first quarter of that coming year. Waterways gathered the foflowing information from the managers. Sales: Waterways likes to keep 10% of the next monthis unit sales in ending inventory. AlI sales are on account. 85% of the Accounts Receivable are collected in the month of sale. and 15% of the Accounts Receivable are collected in the month after sale. Accounts receivable on December 31,2013 , totaled $183,780. Direct Metal, plastic, and rubber together ane 75 e per pound per unit Waterways likes to keep 5% of the materials needed for the next month in its ending imventory. Payment for materials is made within 15 days. 50 is is paid in the month of purchase, and 50N is paid in the month after purchase. Accounts Payable on December 31. 2013, totaled 5120.595. Raw Materials on December 31, 2013, totaled 11,295 pounds. Direct Iabot Labor requires 12 minutes per unit for completion and is paid at a rate of $8 per hour Manufacturing Owerhead Sr-lint and Administrative Variable crliing and adminiatrative cost per unit is $1.60. Other Information The Cash balance on December 31,2013 , totaled $100,500, but management has decided it would like to maintain a cash balance of at least $800,000 beginning on January 31 , 2014. Dividends are paid each month at the rate of $2.50 per share for 5,000 shares outstanding. The company has an open line of credit with Romney's Bank. The terms of the agreement requires borrowing to be in $1,000 increments at 8% interest. Waterways borrows on the first day of the month and repays on the last day of the month. A $500,000 equipment purchase is planned for February. Instructions For the first quarter of 2014 , do the following. (a) Prepare a sales budget. (b) Prepare a production budget. (c) Prepare a direct materials budget. (Round to nearest dollar) (d) Prepare a direet labor budget. (For calculations, round to the nearest hour.) (e) Prepare a manufacturing overhead budget. (Round amounts to the nearest dollar:) (f) Prepare a selling and administrative budget. (g) Prepare a schedule for expected cash collections from customers. (h) Prepare a schedule for expected payments for materials purchases. (Round totals to nearest dollar) (i) Prepare a cash budget