A company manufactures and sells a single product. The following budget details are available:

$ per unit $ per unit

Selling price $75$

Less:

Materials $25$

Labour $20(45)$

Contribution $30$

Additional information:

$(1)$ Budgeted sales units are as follows:

Jan Feb Mar Apr May June July

$200450500550550700800$

$(2)$ Opening inventory $($units$)$ at the start of January will be $150$ units. Closing inventory for

each month is estimated at $10\%$ of the sale units for the next month.

$(3)$ Production occurs in the same month of sales. Materials and labour costs are paid for in

the same month of production.

$(4)$ From the month of January, assume that all sales are on credit, with sales revenue

being received in the following pattern: $75\%$ in the month of sale and $25\%$ in the

following month.

$(5)$ Fixed overheads are paid for in the month in which they are incurred. There are

expected to be as follows: January $$10,000,$ February $ $15,000$ and it is assumed that

fixed overheads will increase to $ $18,000$ from the month of March.

$(6)$ Machinery costing $$1,200,000$ is due to be installed in February. One third of this cost

will be paid in each of the months April, May and June.

$(7)$ Taxation of $$150,000$ will be paid in June.

$(8)$ A $$7,000,000$ loan from the Development Bank will be received in June.

$(9)$ The opening bank balance in January will be $ $500,000.$

Required:

Prepare the following budgets for the six months January to June

a$)$ Sales Budget

b$)$ Production Budget

c$)$ Cash Budget