Budgeted income statement and supporting budgets The budget director of Gold Medal Athletic Co., with the assistance of the controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income .statement for March: a. Estimated sales for March: Batting helmet 1,200 units at 40 per unit Football helmet 6,500 units at 160 per unit b. Estimated inventories at March 1: Direct materials: Finished products: Plastic 90 lb. Batting helmet 40 units at 25 per unit Foam lining 80 lb. Football helmet 240 units at 77 per unit c. Desired inventories at March 31: Direct materials: Finished products: Plastic 50 lb. Batting helmet 50 units at 25 per unit Foam lining 65 lb. Football helmet 220 its at 78 per unit d. Direct materials used in production: In manufacture of batting helmet: Plastic 1.20 lb. per unit of product Foam lining 0.50 lb. per unit of product In manufacture of football helmet: Plastic 3.50 lb. per unit of product Foam lining 1.50lb. per unit of product e. Anticipated cost of purchases and beginning and ending inventory of direct materials: Plastic 6.00 per lb. Foam lining 4.00 per lb. f. Direct labor requirements: Batting helmet: Molding Department 0.20 hr. at 20 per hr. Assembly Department 0.50 hr. at 14 per hr. Football helmet: Molding Department 0.50 hr. at 20 per hr. Assembly Department l.80 hrs.at 14perhr. g. Estimated factory overhead costs for March: Indirect factory wages 86,000 Power and light 4,000 Depreciation of plant and equipment 12,000 Insurance and property tax 2300 h. Estimated operating for March: Sales salaries expense 184,300 Advertising expense 87,200 Office salaries expense 32,400 Depreciation expenseoffice equipment 3,800 Telephone expenseselling 5,800 Telephone expenseadministrative 1,200 Travel expenseselling 9,000 Office supplies expense 1,100 Miscellaneous administrative expense 1,000 i. Estimated other income and expense for March: Interest Revenue 940 Interest Expense 872 j. Estimated tax rate: 30% Instructions 1.Prepare a sales budget for March. 2.Prepare a production budget for March. 3. Prepare a direct materials purchases budget for March. 4. Prepare a direct labor cost budget for March. 5. Prepare a factory overhead cost budget for March. 6. Prepare a cost of goods sold budget for March. Work in process at the beginning of March is estimated to be 15,300, and work in process at the end of March is desired to be 14,800. 7.Prepare a selling and administrative expenses budget for March. 8.Prepare a budgeted income statement for March. 9.Prepare a factory overhead cost budget for March. 10.Prepare a cost of goods .sold budget for March. Work in process at the beginning of March is estimated to the 115,300, and work in process at the end of March is desired to be 14,800. 11.Prepare a selling and administrative expenses budget for March. 12.Prepare a budgeted income statement for March.

Budgeted income statement and supporting budgets The budget director of Gold Medal Athletic Co., with the assistance of the controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income statement for March 2016: a. Estimated sales for March: Batting helmet 1,200 units at 40 per unit Football helmet 6,500 units at 160 per unit b. Estimated inventories at March 1: Direct materials: Finished products: Plastic 90 lbs. Batting helmet........ 40 units at 25 per unit Foam lining 80 lbs. Football helmet....... 240 units at 77 per unit c. Desired inventories at March 31: Direct materials: Finished products: Plastic50 lbs. Batting helmet......... 50 units at 25 per unit Foam lining65 lbs. Football helmet........ 220 units at 78 per unit d. Direct materials used in production: In manufacture of batting helmet: Plastic 1.20 lbs. per unit of product Foam lining 0.50 lb. per unit of product In manufacture of football helmet: Plastic 3.50 lbs. per unit of product Foam lining 1.50 lbs. per unit of product e. Anticipated cost of purchases and beginning and ending inventor) of direct materials: Plastic 6.00 per lb. Foam lining 4.00 per lb. f. Direct labor requirements: Batting helmet: Molding Department 0.20 hr. at 20 per hr. Assembly Department 0.50 hr. at 14 per hr. Football helmet: Molding Department 0.50 hr. at 20 per hr. Assembly Department 1.80 hrs. at 14 per hr. g. Estimated factory overhead costs for March: Indirect factory wages 86,000 Power and light 4,000 Depreciation of plant and equipment 12,000 Insurance and property tax 2,300 h. Estimated operating expenses for March: Sales salaries expense 184,300 Advertising expense 87,200 Office salaries expense 32,400 Depreciation expenseoffice equipment 3,800 Telephone expenseselling 5,800 Telephone expenseadministrative 1,200 Travel expense-selling 9,000 Office supplies expense 1,100 Miscellaneous administrative expense 1,000 i. Estimated other income and expense for March: Interest revenue 940 Interest expense 872 j. Estimated tax rate: 30% Instructions 1. Prepare a sales budget for March. 2. Prepare a production budget for March. 3. Prepare a direct materials purchases budget for March. 4. Prepare a direct labor cost budget for March. 5. Prepare a factory overhead cost budget for March. 6. Prepare a cost of goods sold budget for March. Work in process at the beginning of March is estimated to be 15,300, and work in process at the end of March is desired to be 14,800. 7. Prepare a selling and administrative expenses budget for March. 8. Prepare a budgeted income statement for March.

Refer to Cornerstone Exercise 8.2 for the production budgets for practice balls and match balls. Every practice ball requires 0.7 square yard of polyvinyl chloride panels, one bladder with valve (to fill with air), and 3 ounces of glue. FlashKicks policy is that 20 percent of the following months production needs for raw materials be in ending inventory. Beginning inventory in January for all raw materials met this requirement. Required: 1. Construct a direct materials purchases budget for each type of raw materials for the practice ball line for January and February of the coming year. 2. What if FlashKick decreased the ending inventory percentage to 15 percent of the next months production needs? What impact would that have on the direct materials purchases budgets prepared in Requirement 1? Refer to Cornerstone Exercise 8.1, through Requirement 1. FlashKick requires ending inventory of product to equal 20 percent of the next months unit sales. Beginning inventory in January was 3,100 practice soccer balls and 400 match soccer balls. Required: 1. Construct a production budget for each of the two product lines for FlashKick Company for the first three months of the coming year. 2. What if FlashKick wanted a production budget for the two product lines for the month of April? What additional information would you need to prepare this budget?

Budgeted income statement and supporting budgets The budget director of Feathered Friends Inc., with the assistance of thee controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income statement for December: A. Estimated sales for December Bird house....................... 3,200 units at 50 per unit Bird feeder....................... 3,000 units at 70 per unit B. Estimated inventories at December 1: Direct materials Finished products: Wood............ 220 ft Bird house........ 320 units at 27 per unit Plastic............ 240 ft Bird house........ 270 units at 40 per unit C. Desired inventories at December 31: Direct materials Finished products: Wood............ 220 ft Bird house........ 290 units at 27 per unit Plastic............ 200 ft Bird house........ 205 units at 41 per unit D. Direct materials used in production: In manufacture of Bird House: In manufacture of Bird Feeder: Wood............ 0.80 ft. per unit of product Wood........ 1.20 ft. per unit of product Plastic............ 0.50 lb. per unit of product Plastic......... 0.75 lb. per unit of product E. Anticipated cost of purchases and beginning and ending inventory of direct materials: Wood 7.00 per ft Plastic 1.00 per lb. F. Direct labor requirements: Bird House: Fabrication Department...................... 0.20 hr. at 16 per hr. Assembly Department........................ 0.30 hr. at 12 per hr. Bird Feeder: Fabrication Department...................... 0.40 hr. at 16 per hr. Assembly Department........................ 0.35 hr. at 12 pr hr. G. Estimated factory overhead costs for December: Indirect factory wages 75,000 Depreciation of plant and equipment 23,000 Power and light 6,000 Insurance and property tax 5,000 H. Estimated operating expenses for December: Sales salaries expense 70,000 Advertising expense 18,000 Office salaries expense 21,000 Depreciation expenseoffice equipment 600 Telephone expenseselling 550 Telephone expenseadministrative 250 Travel expenseselling 4,000 Office supplies expense 200 Miscellaneous administrative expense 400 I. Estimated other income and expense for December: Interest revenue200 Interest expense122 J. Estimated tax rate: 30% Instructions 1. Prepare a sales budget for December. 2. Prepare a production budget for December. 3. Prepare a direct materials purchases budget for December. 4. Prepare a direct labor cost budget for December. 5. Prepare a factory overhead cost budget for December. 6. Prepare a cost of goods sold budget for December. Work in process at the beginning of December is estimated to be 29,000, and work in process at the end of December is estimated to be 35,400. 7. Prepare a selling and administrative expenses budget for December. 8. Prepare a budgeted income statement for December.