Waterways Corporation is preparing its budget for the coming year, $2025.$ 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.

$\backslash$table$[[$Sales$,],[$Unit sales for November $2024,114,000],[$Unit sales for December $2024,101,000],[$Expected unit sales for January $2025,114,000],[$Expected unit sales for February $2025,112,000],[$Expected unit sales for March $2025,117,000],[$Expected unit sales for April $2025,126,000],[$Expected unit sales for May $2025,138,000],[$Unit selling price,$$12$

Direct Materials

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 $31,2024$ 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 $31,2024,$ totaled $$120,595.$

Direct Labor

Labor requires $12$ minutes per unit for completion and is paid at a rate of $$6$ per hour.

$\backslash$table$[[$Manufacturing Overhead$],[$Indirect materials,$30,$per labor hour,$],[$Indirect labor,$50,$per labor hour,$],[$Utilities$,40,$per labor hour,$],[$Maintenance$,20,$per labor hour,$],[$Salaries$,$$$41,000,$per month,$],[$Depreciation$,$$$15,800,$per month,$]$

The Cash balance on December $31,2024,$ totaled $$100,000,$ but management has decided it would like to maintain a cash balance of at least $$800,000$ beginning on January $31,2025.$ Dividends are paid each month at the rate of $$2\mathrm{.}50$ per share for $5,360$ shares outstanding. The company has an open line of credit with Romney's Bank. The terms of the agreement requires borrowing to be in $$1,000$ increments at $6\%$ interest. Waterways borrows on the first day of the month and repays on the last day of the month. A $$450,000$ equipment purchase is planned for February.

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