Greish Inc. is preparing its annual budgets for the year ending December 31, 2016. Accounting assistants have provided the following data:

An accounting assistant has prepared the detailed manufacturing overhead budget and the selling and administrative expenses budget. The latter shows selling expenses of $850,000 for product LN 35 and $390,000 for product LN 40, and administrative expenses of $520,000 for product LN 35 and $180,000 for product LN 40. Income taxes are expected to be 30%.
Instructions
Prepare the following budgets for the year. Show data for each product. Quarterly budgets should not be prepared.
(a) Sales
(b) Production
(c) Directmaterials
(d) Direct labour
(e) Income statement

Product LN 35 Product LN 40 Sales budget Expected volume in units 400,000 240,000 Unit selling price Production budget S30 $35 Desired ending finished good units 30,000 20,000 20,000 15,000 Beginning finished goods units Direct materials budget: Direct materials per unit (kilograms) Desired kilograms of ending direct materials Beginning kilograms of direct materials Cost per kilogram Direct labour budget: 50,000 40,000 S2 15,000 10,000 $3 Direct labour time per unit (hours) Direct labour rate per hour 0.5 $12 0.70 $12 Budgeted income statement: Total unit cost $11 $20