Brief Exercise 9-23 Preparing a Direct Materials Purchases Budget Patrick Inc. makes industrial solvents sold in 5-gallon drums. Planned production in units for the first 3 months of the coming year is: January 43,800 February 41,000 March 50,250 Each drum requires 5.5 gallons of chemicals and one plastic drum. Company policy requires that ending inventories of raw materials for each month be 15% of the next month's production needs. That policy was met for the ending inventory of December in the prior year. The cost of one gallon of chemicals is $2.00. The cost of one drum is $1.60. (Note: Round all unit amounts to the nearest unit. Round all dollar amounts to the nearest dollar.) Required: 1. Calculate the ending inventory of chemicals in gallons for December of the prior year and for January and February. What is the beginning inventory of chemicals for January? 2. Prepare a direct materials purchases budget for chemicals for the months of January and February 3. Calculate the ending inventory of drums for December of the prior year and for January and February 4. Prepare a direct materials purchases budget for drums for the months of January and February Brief Exercise 9-29 Preparing a Budgeted Income Statement Oliver Company provided the following information for the coming year: Units produced and sold 160,000 Cost of goods sold per unit $6.30 Selling price S10.80 Variable selling and administrative expenses per unit $1.10 Fixed selling and administrative expenses $423,000 Tax rate 35% Required: Prepare a budgeted income statement for Oliver Company for the coming year. (Note: Round all income statement amounts to the ncarest dollar.)