Abeng Corp, a rapidly$-$expanding crossbow distributor, is in the process of formulating plansfor $2021.$ James Chambers, director of marketing, has completed his $2021$ forecast and isconfident that sales estimates will be met or exceeded. The following forecasted salesfigures show the growth expected and will provide the planning basis for other corporatedepartments:Month Sales $($units$)$ Month Sales $($units$)$January $7,200$ July $12,000$February $8,000$ August $11,000$March $7,200$ September $12,800$April $8,800$ October $13,600$May $10,000$ November $12,000$June $11,200$ December $14,000$Ellen Eglin, assistant controller, has been given responsibility for formulating the cash flowprojections, a critical element during a period of rapid expansion. The following information willbe used in preparing the cash analysis:i$.$ Bows are sold at an average price of $$150.$ii$.$ Abeng has experienced an excellent record in accounts receivable collection and expectsthis trend to continue. The company collects $30\%$ of its billings in the month of sales, $50\%$in the first month following sale and the balance in the second month after sale.iii. The purchase of crossbows is Abengs largest expenditure; the cost of these items is $55\%$ ofsales. The company maintains an ending inventory equal to $60\%$ of the next monthsrequirements.iv$.$ Prior experience shows that $75\%$ of accounts payable is paid by Abeng $1$ month afterpurchase and $25\%$ in the second month after purchase.v$.$ Wages, including fringe benefits, are a function of sales volume and are equal to $15\%$ of thecurrent months sales$\mathrm{.}2$vi$.$ Administrative expenses are projected to be $$2,640,000$ for $2021.$ All of these expenses areincurred uniformly throughout the year except for the property taxes. Property taxes arepaid in four equal installments in the last month of each quarter. The composition of theexpenses is:Salaries $$480,000$Promotion $$660,000$Property taxes $$240,000$Insurance $$360,000$Utilities $$300,000$Depreciation $$600,000$$$2,640,000$vii. A dividend of $$150,000$ will be paid in August.viii. In August, the company plans an issue of common stock, which is expected to raise$$350,000.$ix$.$ Equipment with an original cost of $$600,000$ will be disposed of in September for $$250,000.$New equipment will be purchased in that month at a cost of $$800,000.$ Payment will bemade in two equal installments, in June and September.x$.$ Income tax payments are made by Abeng in the first month of each quarter based onincome for the prior quarter. The income tax rate is $35\%$ and the firms net income for thesecond quarter of $2021$ is projected to be $$612,000.$xi$.$ Abeng has a corporate policy of maintaining a minimum end$-$of month cash balance of$$150,000.$ The company maintains a line of credit to maintain this balance. Borrowings aremade at the beginning of the month and interest $(7\%)$ is paid at the end of the month.

Required:

a$.$ Prepare the following for the third quarter of the year:

i$.$ Sales budget $[3$ marks$]$

ii$.$ Schedule of cash collections $[10$ marks$]$

iii. Purchases budget $[10$ marks$]$

iv$.$ Schedule of cash disbursement for purchases $[7$ marks$]$

v$.$ Cash budget $[20$ marks$]$