Problem 22-1A (Algo) Manufacturing: Preparing production, materials, labor, and overhead budgets LO P1 [The following information applies to the questions displayed below] Black Diamond Company produces snowboards. Each snowboard requires 2 pounds of carbon fiber. Management reports that 6,000 snowboards and 7,000 pounds of carbon fiber are in inventory at the beginning of the third quarter, and that 160,000 snowboards are budgeted to be sold during the third quarter. Management wants to end the third quarter with 4,500 snowboards and 5,000 pounds of carbon fiber in inventory. Carbon fiber costs $25 per pound. Each snowboard requires 0.5 hour of direct labor at $30 per hour. Variable overhead is budgeted at the rate of $18 per direct labor hour. The company budgets fixed overhead of $1,792,000 for the quarter. Problem 22-1A (Algo) Part 1 Required: 1. Prepare the production budget for the third quarter. Hint: Desired ending inventory units are given. BLACK DIAMOND COMPANY Production Budget (in units) Third Quarter Total required units Units to produce Problem 22-1A (Algo) Part 2 2. Prepare the direct materials budget for the third quarter. BLACK DIAMOND COMPANY Direct Materials Budget Units to produce Materials needed for production (pounds) Total materials required (pounds) Materials to purchase (pounds) Cost of direct materials purchases Third Quarter Problem 22-1A (Algo) Part 3 3. Prepare the direct labor budget for the third quarter. BLACK DIAMOND COMPANY Direct Labor Budget Units to produce Direct labor hours needed Cost of direct labor Third Quarter Problem 22-1A (Algo) Part 4 4. Prepare the factory overhead budget for the third quarter. BLACK DIAMOND COMPANY Factory Overhead Budget Third Quarter Direct labor hours needed Budgeted variable overhead Budgeted total factory overhead