The Irwin Batting Company manufactures wood baseball bats. Irwin's two primary products are a youth bat,...

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The Irwin Batting Company manufactures wood baseball bats. Irwin's two primary products are a youth bat, designed for children and young teens, and an adult bat, designed for high school and college-aged players. Irwin sells the bats to sporting goods stores and all sales are on account. The youth bat sells for $25; the adult bat sells for $65. Irwin's highest sales volume is in the first three months of the year as retailers prepare for the spring baseball season. Irwin's balance sheet for December 31, 2024, and other data for the first quarter of 2025 follow: Current Assets: Cash Irwin Batting Company Balance Sheet December 31, 2024 Assets Accounts Receivable Raw Materials Inventory Finished Goods Inventory Total Current Assets Property, Plant, and Equipment: Equipment Less: Accumulated Depreciation Total Assets Current Liabilities: Liabilities $ 40,000 23,200 4,600 22,640 $ 90,440 160,000 (20,000) $ 140,000 230,440 Accounts Payable $ 14,500 Stockholders' Equity Common Stock, no par $ 110,000 105,940 Retained Earnings 215,940 Total Stockholders' Equity $ 230,440 Total Liabilities and Stockholders' Equity a. Budgeted sales are 2,000 youth bats and 3,300 adult bats. b. Finished Goods Inventory on December 31, 2024, consists of 600 youth bats at $20 each and 560 adult bats at $19 each. c. Desired ending Finished Goods Inventory is 150 youth bats and 460 adult bats; FIFO inventory costing method is used. d. Direct materials requirements are 42 ounces of wood per youth bat and 62 ounces of wood per adult bat. The cost of wood is $0.20 per ounce. e. Raw Materials Inventory on December 31, 2024, consists of 23,000 ounces of wood at $0.20 per ounce. f. Desired ending Raw Materials Inventory is 23,000 ounces (indirect materials are insignificant and not considered for budgeting purposes). g. Each bat requires 0.6 hours of direct labor; direct labor costs average $12 per hour. h. Variable manufacturing overhead is $0.70 per bat. i. Fixed manufacturing overhead includes $1,000 per quarter in depreciation and $12,775 per quarter for other costs, such as insurance and property taxes. j. Fixed selling and administrative expenses include $11,000 per quarter for salaries; $2,000 per quarter for rent; $1,300 per quarter for insurance; and $300 per quarter for depreciation. k. Variable selling and administrative expenses include supplies at 1% of sales. Requirements 1. Prepare Irwin's sales budget for the first quarter of 2025. 2. Prepare Irwin's production budget for the first quarter of 2025. 3. Prepare Irwin's direct materials budget, direct labor budget, and manufacturing overhead budget for the first quarter of 2025. Round the predetermined overhead allocation rate to two decimal places. The overhead allocation base is direct labor hours. 4. Prepare Irwin's cost of goods sold budget for the first quarter of 2025. 5. Prepare Irwin's selling and administrative expense budget for the first quarter of 2025. The Irwin Batting Company manufactures wood baseball bats. Irwin's two primary products are a youth bat, designed for children and young teens, and an adult bat, designed for high school and college-aged players. Irwin sells the bats to sporting goods stores and all sales are on account. The youth bat sells for $25; the adult bat sells for $65. Irwin's highest sales volume is in the first three months of the year as retailers prepare for the spring baseball season. Irwin's balance sheet for December 31, 2024, and other data for the first quarter of 2025 follow: Current Assets: Cash Irwin Batting Company Balance Sheet December 31, 2024 Assets Accounts Receivable Raw Materials Inventory Finished Goods Inventory Total Current Assets Property, Plant, and Equipment: Equipment Less: Accumulated Depreciation Total Assets Current Liabilities: Liabilities $ 40,000 23,200 4,600 22,640 $ 90,440 160,000 (20,000) $ 140,000 230,440 Accounts Payable $ 14,500 Stockholders' Equity Common Stock, no par $ 110,000 105,940 Retained Earnings 215,940 Total Stockholders' Equity $ 230,440 Total Liabilities and Stockholders' Equity a. Budgeted sales are 2,000 youth bats and 3,300 adult bats. b. Finished Goods Inventory on December 31, 2024, consists of 600 youth bats at $20 each and 560 adult bats at $19 each. c. Desired ending Finished Goods Inventory is 150 youth bats and 460 adult bats; FIFO inventory costing method is used. d. Direct materials requirements are 42 ounces of wood per youth bat and 62 ounces of wood per adult bat. The cost of wood is $0.20 per ounce. e. Raw Materials Inventory on December 31, 2024, consists of 23,000 ounces of wood at $0.20 per ounce. f. Desired ending Raw Materials Inventory is 23,000 ounces (indirect materials are insignificant and not considered for budgeting purposes). g. Each bat requires 0.6 hours of direct labor; direct labor costs average $12 per hour. h. Variable manufacturing overhead is $0.70 per bat. i. Fixed manufacturing overhead includes $1,000 per quarter in depreciation and $12,775 per quarter for other costs, such as insurance and property taxes. j. Fixed selling and administrative expenses include $11,000 per quarter for salaries; $2,000 per quarter for rent; $1,300 per quarter for insurance; and $300 per quarter for depreciation. k. Variable selling and administrative expenses include supplies at 1% of sales. Requirements 1. Prepare Irwin's sales budget for the first quarter of 2025. 2. Prepare Irwin's production budget for the first quarter of 2025. 3. Prepare Irwin's direct materials budget, direct labor budget, and manufacturing overhead budget for the first quarter of 2025. Round the predetermined overhead allocation rate to two decimal places. The overhead allocation base is direct labor hours. 4. Prepare Irwin's cost of goods sold budget for the first quarter of 2025. 5. Prepare Irwin's selling and administrative expense budget for the first quarter of 2025.