Zortek Corp. budgets production of 310 units in January and 290 units in February. Each finished unit requires three pounds of raw material Z, which costs $4 per pound. Each month's ending inventory of raw materials should be 40% of the following month's budgeted production. The January 1 raw materials inventory has 130 pounds of Z. Prepare a direct materials budget for January. ZORTEK CORP. Direct Materials Budget For Month Ended January 31 Budget production (units) units Ibs. Materials needed for production (Ibs.) Ibs. Ibs Ibs Total materials requirements (Ibs.) Ibs. o Ibs. Materials to be purchased (Ibs.) per Ib. Total cost of direct materials purchases Zhao Co. has fixed costs of $390,600. Its single product sells for $181 per unit, and variable costs are $119 per unit. The company expects sales of 10,000 units. Prepare a contribution margin income statement for the year ended December 31, 2017. ZHAO CO. Contribution Margin Income Statement