On August 31, Blake \& Sons had an inventory of 50 units of finished goods, and it had accounts receivable totaling \(\$ 75,000\). Sales, in units, have been budgeted as follows for the next four months:

Blake has a policy that \(20 \%\) of the following month's sales should be maintained in ending inventory. Each unit sells for \(\$ 500\). All sales are on account. The budgeted cash collections anticipate that one half of sales will be collected in the month of sale and the other half in the following month.
\section*{Required}
A. Prepare a production budget for the months of September, October, and November.
B. Prepare a schedule of budgeted cash collections from sales for the months of September, October, and November.

C. Actual sales values (which drive the entire budgeting process) are not known with certainty. Are the various budgets and schedules meaningful since they are based on management's estimate of sales in the coming year? Can you identify other examples of accounting estimates?

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September 300 October 400 November 450 December 500