Deleon Inc. is preparing its annual budgets for the year ending December 31, 2020. Accounting assistants furnish the data shown below.

		Product JB 50		Product JB 60
Sales budget:
Anticipated volume in units		400,000		200,000
Unit selling price		$20		$25
Production budget:
Desired ending finished goods units		30,000		15,000
Beginning finished goods units		25,000		10,000
Direct materials budget:
Direct materials per unit (pounds)		2		3
Desired ending direct materials pounds		30,000		10,000
Beginning direct materials pounds		40,000		15,000
Cost per pound		$3		$4
Direct labor budget:
Direct labor time per unit		0.4		0.6
Direct labor rate per hour		$12		$12
Budgeted income statement:
Total unit cost		$13		$20

An accounting assistant has prepared the detailed manufacturing overhead budget and the selling and administrative expense budget. The latter shows selling expenses of $560,000 for product JB 50 and $360,000 for product JB 60, and administrative expenses of $540,000 for product JB 50 and $340,000 for product JB 60. Interest expense is $150,000 (not allocated to products). Income taxes are expected to be 30%.

Sales 9,252,900) 5,499,900 14,752,800 Cost of Goods Sold 5,632,200 4,481,400 10,113,600 Gross Profit 3,620,700 1,018,500 4,639,200 Operating Expenses X Selling Expenses 661,000 361,000 1,022,000 X Administrative Expenses 545,000 344,000 889,000 X Total Operating Expenses 1,206,000 705,000 1,911,000 X Income from Operations 2,414,700 313,500 2,728,200 Interest Expense 150,000.00 x Income before Income Taxes 2,578,200 Income Tax Expense 773,460 Net Income / (Loss) 1,804,740