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Here is the data for Breakers, Inc. for the year 2019

Kindly answer 3,4 & 5

1. SALES BUDGET

Breakers, Inc. is preparing budgets for the quarter ending June 30. Budgeted sales for

the next five months are:

-April 21,000 units

-May 51,000 units

-June 31,000 units

-July 26,000 units

-August 17,000 units

The selling price is $12 per unit.

2. PRODUCTION BUDGET

The management of Breakers, Inc. wants ending inventory to be equal to 21% of the

following months budgeted sales in units. On March 31, 5,000 units were on hand.

3. DIRECT MATERIAL BUDGET

At Breakers, six pounds of material are required per unit of product. Management wants

materials on hand at the end of each month equal to 11% of the following months

production. On March 31, 12,000 pounds of material are on hand. Material cost $.50 per

pound.

4. DIRECT LABOR BUDGET

At Breakers, each unit of product requires 0.1 hours of direct labor. The Company has a

no layoff policy so all employees will be paid for 40 hours of work each week. In

exchange for the no layoff policy, workers agreed to a wage rate of $9 per hour

regardless of the hours worked (No overtime pay). For the next three months, the direct

labour workforce will be paid for a minimum of 3,000 hours per month.

5. OVERHEAD BUDGET

QUARTER Indirect Labor Indirect materials Utilities Rent Insurance Maintenance APRIL 18,000 35% of DL 4,200 13,300 3,800 8,200 MAY 24,500 38% of DL 7,400 13,300 3,800 9,400 JUNE 19,900 39% of DL 3,200 13,300 3,800 9,200

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