a. Expected sales of the seeding bags:

Months October November December January 2022 Sales units 8,000 10,000 12,000 14,000

b. The selling price of the seeding bag is RM15 per unit. At the end of each month, SPN plans to always have seeding bags ready at the nursery, 10% of the sales of the following month.

c. The details of material required in the production of the seeding bags: Material Soil X

Quantity per seeding bag 1.5kg Price per kg RM2

Ending inventory 5% of following month production needs

Inventory on 1st Oct 2021 763kg

d. Company plans to hire workers who are not only able to produce the seeding bags but also able to handle the sales. The wages for the labour consist of a basic rate of RM6 per hour and sales commissions of RM1.50 for each seeding bag sold. Each worker is expected to spend 15 minutes to produce a unit of seeding bags.

e.Company also has to rent an extra plot of land adjacent to the current location. The monthly rate is RM1,000 per month. SPN is also expected to spend packaging costs of RM2 per unit of seeding bag sold. Required: i. Prepare the following budgets for each month in the fourth quarter 2021 and the total for the quarter: a. Production units; b. Direct material purchase costs; c. Direct labour costs; and d. Sale and Administrative expenses.