Waterways Continuing Problem 24 a-i (Part Level Submission) Waterways Corporation is preparing its budget for the coming year, 2020. The first step is to plan for the first quarter of that coming year. The company has gathered information from its managers in preparation of the budgeting process Sales Unit sales for November 2019 Unit sales for December 2019 Expected unit sales for January 2020 Expected unit sales for February 2020 Expected unit sales for March 2020 Expected unit sales for April 2020 Expected unit sales for May 2020 Unit selling price 111,000 103,000 114,000 112,000 116,000 124,000 137,000 $12 waterways likes to keep 10% of the next month's unit sales in ending inventory. All 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, 2019, totaled $185,400 Direct materials cost 80 cents per pound. Two pounds of direct materials are required to produce each unit. waterways likes to keep 5% of the materials needed for the next month in its ending inventory. Raw Materials on December 31, 2019, totaled 11,380 pounds. Payment for materials is made within 15 days. 50% is paid in the month of purchase, and 50% is paid in the month after purchase. Accounts Payable on December 31, 2019, totaled $104,585 Direct Labor Labor requires 12 minutes per unit for completion and is paid at a rate of $9 per hour. Manufacturing Overhead Indirect materials Indirect labor Utilities Maintenance Salaries Depreciation Property taxes Insurance Maintenance 30c per labor hour 50c per labor hour 50 per labor hour 304 per labor hour $41,000 per month $17,800 per month $2,800 per month $1,100 per month $1,400 per month Selling and Administrative Variable selling and administrative cost per unit is $1.70 Advertising Insurance Salaries Depreciation Other fixed costs $16,000 a month $1,500 a month $71,000 a month $2,700 a month $3,200 a month Other Information The Cash balance on December 31, 2019, totaled $100,000, but management has decided it would like to maintain a cash balance of at least $700,000 beginning on January 31, 2020. Dividends are paid each month at the rate of $2.70 per share for 5,180 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 9% interest, waterways borrows on the first day of the month and repays on the last day of the month. A $550,000 equipment purchase is planned for February (a) Your answer is correct. For the first quarter of 2020, prepare a sales budget. WATERWAYS CORPORATION Sales Budget For the First Quarter of 2020 First Quarter March February Quarter January Expected Unit Sales 114000 112000 116000 342000 Unit Selling Pricev 12 12 12 12 1368000 1344000 1392000 4104000 Total Sales Click if you would like to Show Work for this question: Open Show Work SHOW ANSWER LINK TO TEXT LINK TO TEXT LINK TO TEXT (b) For the first quarter of 2020, prepare a production budget WATERWAYS CORPORATION Production Budget For the First Quarter of 2020 First Quarter February March January Quarter Expected Unit Sales Add Desired Ending Direct Materials Total Materials Required Less . Beginning Direct Materials Required Production Units 114000 114000 116000 LINK TO TEXT LINK TO TEXT LINK TO TEXT For the first quarter of 2020, prepare a production budget. WATERWAYS COR Production B For the First Quarter o January Expected Unit Sales 114000 Total Materials Required Beginning Finished Goods Uhit Required Production Units Expected Unit Sales Desired Ending Direct Materials Total Required Units Beginning Direct Materials Direct Materials Per Unit Desired Ending Finished Goods Unit Direct Materials Purchases als k for this question: Open Sh LINK TO TEXT LINK TO TEXT LINK TO TEXT