altcel, CUI ULLUM Case Problems Learning Objective 3 Check Figure todencome Group A Problem 27-1A Objective: To prepare a full set of income statement budgets Frankfort Manufacturing Company hopes to sell 1.500 Model R units and 2,800 Model S units in 20X1. Unit sales prices are expected to be $360 for Model R and $420 for Model S. The firm begins the year with inventories of 300 and 500 units, respectively, and plans to end the year with 30% less of each model in the inventory Unit direct materials costs are estimated at $40 for Model Rand $70 for Model S. Direct labor costs are planned to be $150 for all units, while factory overhead is assigned at 80% of direct labor costs. The beginning raw materials inventory for 20X1 is 526,000, while the estimated ending inventory of raw materials is $16.000 Chapter 27 Budgeting and Standard Cost Accounting 1223 TER 27 REVIEW, PRACTICE, ANDIA Selling expenses of $24 a unit and general expenses of $16 a unit are expected for the units sold, while other income for the year is estimated at $4,000. Income taxes are estimated to be 20% of net income before taxes. Directions: Based on this information, prepare the following budgets for 20X1 (a) sales, (b) production, (c) direct materials purchases, (d) direct labor cost, (e) factory overhead. () cost of goods manufactured. (g) cost of goods sold. (h) operating expenses, and (i) income statement