Preparing Operating Budget Components Wesley Power Tools manufactures a wide variety of tools and accessories. One of its more popular items s a cordiess power bandlsaw, Each bandisaw sells for $44. Wesley expects the following unit sales: January February March April May 2.000 2.200 2,700 2,500 1,900 Wesley's ending finished goods inventory policy is 30 percent of the next month's sales Suppose each bandisaw takes approximately 0.75 hours to manufacture, and Wesley pays an average labor wage of $18 per hour Each bandisaw requires a plastic housing that Wesley purchases from a supplier at a cost of $7.00 each. The company has an ending raw materials inventory policy of 25 percent of the following month's production requirements. Materials other than the housing unit total $4.50 per bandisaw Manufacturing overhead for this product includes $72,900 annual fixed overhead (based on production of 27,000 units) and $1.20 per unit variable manufacturing overhead. Wesley's selling expenses are 7 percent of sales dollars, and administrative expenses are fixed at $18,000 per month. Required Prepare the tollowing for the first quarter 1. Sales budget. 2. Production budget. 3. Raw materials purchases budget for the plastic housings. 4. Direct labor budget Prepare the tollowing for the first quarter 5. Cost of goods sold budget. 6. Selling and administrative expense budget. 7. Budgeted income statement for the baodisaw product