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Waterways Corporation is preparing its budget for the coming year, 2022. The first step is to plan for the first quarter of that coming year. The company has gathered information from its managers in preparation of the budgeting process. SalesUnit sales for November 2021112,000Unit sales for December 2021104,000Expected unit sales for January 2022113,000Expected unit sales for February 2022112,000Expected unit sales for March 2022116,000Expected unit sales for April 2022125,000Expected unit sales for May 2022138,000Unit selling price$12Waterways likes to keep 10% of the next months unit sales in ending inventory. All sales are on account. 85% of the Accounts Receivable are collected in the month of sale, and 15% of the Accounts Receivable are collected in the month after sale. Accounts receivable on December 31, 2021, totaled $187,200. Direct MaterialsDirect materials cost 80 cents per pound. Two pounds of direct materials are required to produce each unit. Waterways likes to keep 5% of the materials needed for the next month in its ending inventory. Raw Materials on December 31, 2021 totaled 11,290 pounds. Payment for materials is made within 15 days. 50% is paid in the month of purchase, and 50% is paid in the month after purchase. Accounts Payable on December 31, 2021, totaled $120,595. Labor requires 12 minutes per unit for completion and is paid at a rate of $9 per hour. Manufacturing OverheadIndirect materials30per labor hourIndirect labor50per labor hourUtilities50per labor hourMaintenance20per labor hourSalaries$41,000per monthDepreciation$18,000per monthProperty taxes$2,900per monthInsurance$1,200per monthMaintenance$1,300per monthSelling and AdministrativeVariable selling and administrative cost per unit is $1. 60. Advertising$15,000a monthInsurance$1,400a monthSalaries$70,000a monthDepreciation$2,800a monthOther fixed costs$3,300a monthOther InformationThe Cash balance on December 31, 2021, totaled $99,000, but management has decided it would like to maintain a cash balance of at least $700,000 beginning on January 31, 2022. Dividends are paid each month at the rate of $2. 70 per share for 4,610 shares outstanding. The company has an open line of credit with Romneys Bank. The terms of the agreement requires borrowing to be in $1,000 increments at 9% interest. Waterways borrows on the first day of the month and repays on the last day of the month. A $480,000 equipment purchase is planned for February