Plz i need i clear answer and good front

A) Abu Laqgman Tire Company manufactures racing tires for bicycles. Abu Lagman sells tires for SRSO each. Abu Luqman is planning for the next year by developing a master budget by quarters. Abe Lugman's balance sheet for December 31,2014, follows ABU LUQMAN TIRE COMPANY Balance Sheet December 31, 2014 ASSETS Current Assets: Cash. SR 20,000 25,000 3,000 Accounts Receivable. Raw Materials Inventory Finished Goods Inventory Total Current Assets SR 53,800 Property, Plant, and Equipment: Equipment 175,000 Less: Accumulated Depreciation.(57,000) 118.000 Total Assets LIABILITIES Current Liabilities: Accounts Payable SR 5,000 STOCKHOLDERS EQUITY Common Stock....SR 125,000 Retained Earnings41.800 Total Stockholders' Equity166.800 Total Liabilities and Stockholders' Equity 171800 Other data for Abu Luqman Tire Company: Budgeted sales are 900 tires for the first quarter and expected to increase by 100 tires per quarter. Cash sales are expected to be 30% of total sales, with the remaining 70% sales on account. a. b. Finished Goods Inventory on December 31 consists of 200 tires at SR29 eac. c Desired ending Finished Goods Inventory is 40% of the next quarter's sales; first quarter sales for 2016 are expected be 1,300 tires. FIFO inventory costing method is used. Direct materials cost is SR15 per tire. Desired ending Raw Materials inventory is 20% of the next quarter's direct materials needed for production; desired ending inventory for December 31 is SR3,000; indirect materials are insignificant and not considered for budgeting purposes. d. e. ACCT212 SEM 181-ASSIGNMENT 2 t Each tire requires 0.20 hours of direct labor; direct labor costs average SR18 per hour g. Variable manufacturing overhead is SR2 per tire. h. Fixed manufacturing overhead includes SR3,000 per quarter in depreciation and SR4,232 per quarter for other costs, such as utilities, insurance, and property taxes. L Fixed selling and administrative expenses include SR9,000 per quarter for salaries; SR3,000 per quarter for rent; SR600 per quarter for insurance; and SR500 per quarter Variable selling and administrative expenses indude supplies at 1% of sales. k. for depreciation. j. Capital expenditures include SR20,000 for new manufacturing equipment, to be purchased and paid in the first quarter l. Cash receipts for sales on account are 50% in the quarter of the sale and 50% in the quarter following the sale; December 31, 2014, Accounts Receivable is received in the first quarter of 2015; uncollectible accounts are considered insignificant and not considered for budgeting purposes. m. Direct materials purchases are paid 75% in the quarter purchased and 25% in the following quarter,; December 31, 2014, Accounts Payable is paid in the first quarter of 2015. Direct labor, manufacturing overhead, and selling and administrative costs are paid in the quarter incurred. Income tax expense is projected at SR2,000 per quarter and is paid in the quarter incurred n. o. Requirements 1) Prepare Abu Luqman's operating budget and cash budget for 2015 by quarter. Required schedules and budgets include: sales budget, production budget, direct materials budget, direct labor budget, manufacturing overhead budget, cost of goods sold budget, and selling and administrative expense budget. Manufacturing overhead costs are allocated based on direct labor hours. ..000 mobily 1:37 PM Bassam ACCT212 181 - Assignment 2 ABU LUQMAN TIRE COMPANY Sales Budget For the Year Ended December 31.2015 First Second hirdFourth Bud Sales price per tire ires to be Total sales ABU LUQMAN TIRE COMPANY Production Budget For the Year Ended December 31, 2015 First Second Third Fourth Total Budgeted Plus: Desired tires in ending inventory tires to be sold Total tires needed Less Tires in beginning Budgeted tires to be ed ..ooo mobily 1:37 PM Bassam ACCT212 181 - Assignment 2 13 of 19 ABU LUQMAN TIRE COMPANY Direct Materials Budget For the Year Ended December 31, 2015 Fir 1 Second Third | Fourth Quarter ter uarter Quarter Total Budgeted tires to be Direct materials cost per tire Direct materials needed foe Plus: Desired direct matcrials in ending inventory Total direct materials Less Direct materials in beginning Budgeted purchases of direct ABU LUQMAN TIRE COMPANY Direct Labor Budget For the Year Ended December 31, 2015 First SecondThid Fourth Total Direct labor hours per tire Direct labor hours needed for Budgeted direct labor cost ooo mobily 1:37 PM KBassam ACCT212 181 - Assignment 2 15 of 19 ABU LUOMAN TIRE COMPANY Manufacturing Overhcad Bodget For the Year Ended December 31, 2015 First SecondThi Founh Quarer QuarerQuaner Quarter Total Budgeted tires to be produced Variable overbead cost Budeeted variable overhead od fised ovethead Utilities, insurance, property Budgeted mansfacturing evethead Direct labor hours Budgetod manefacturing overhead Predetermined overhead allocation rate ( Calkulations for Cost of Goods Sold Budget Direct materials cost per tire Direct labor cost per tire ( Manufacturing overhead cost per tire ( Total projected manufacturing cost per tire 17 of 19 ABU LUQMAN TIRE COMPANY Cost of Goods Sold Budget For the Year Ended December 31, 2015 First Second Third Fourth Quaer Quarter Quarter Quaner Total Beginning inventory, 200 tires at Tires produced and sold in 2015 at cach Total budgeted cost of goods sold ABU LUQMAN TIRE COMPANY Selling and Administrative Expense Budget For the Year Ended December 31, 2015 Fist Second Third Fourth Quarter Ouarter Quarter Quarter Total Salaries Expense Rent Expense Insurance Expense Depreciation Expense Supplses Expense ( 1 % of sales) Total budget ed selling and administrative expense