Waterways Corporation is preparing its budget for the coming year, 2022. 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 2021		112,000
Unit sales for December 2021		102,000
Expected unit sales for January 2022		114,000
Expected unit sales for February 2022		114,000
Expected unit sales for March 2022		116,000
Expected unit sales for April 2022		126,000
Expected unit sales for May 2022		136,000
Unit selling price		$ 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, 2021, totaled $ 183,600.

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, 2021 totaled 11,400 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, 2021, totaled $ 120,595.

Direct Labor

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

Manufacturing Overhead
Indirect materials		30¢		per labor hour
Indirect labor		50¢		per labor hour
Utilities		40¢		per labor hour
Maintenance		30¢		per labor hour
Salaries		$ 41,000		per month
Depreciation		$ 18,500		per month
Property taxes		$ 2,900		per month
Insurance		$ 1,200		per month
Maintenance		$ 1,400		per month

Selling and Administrative
Variable selling and administrative cost per unit is $ 1.60.
Advertising		$ 16,000	a month
Insurance		$ 1,600	a month
Salaries		$ 73,000	a month
Depreciation		$ 2,400	a month
Other fixed costs		$ 3,100	a month

1. For the first quarter of 2022, Prepare a manufacturing overhead budget.

2. For the first quarter of 2022, Prepare a selling and administrative budget.

3. for the first quarter of 2022, prepare a schedule for expected cash collections from customers.

4. For the first quarter of 2022, prepare a schedule for expected payments for material purchases.

5. for the first quarter of 2022, prepare a cash budget.