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Funkys Music Factory is preparing budgets for one of its factories for the third quarter of 2023. Relevant information is provided below: Budgeted Sales for

Funkys Music Factory is preparing budgets for one of its factories for the third quarter of 2023. Relevant information is provided below:

Budgeted Sales for the next five months are as follows:

July - 40,000 units

August - 100,000 units

September 60,000 units

October 50,000 units

November 30,000 units

The selling price per unit is $20.

Funkys plans to collect on sales as follows:

70% collected in the month of sale.

30% collected in the month following sale.

June 30th accounts receivable of $50,000 will be collect in full in July.

Ending inventory for each month should be equal to 20% of the following months budgeted sales in units.

On June 30th, 4000 units were on hand.

Five pounds of material are required to produce each unit.

Materials on hand at the end of each month should equal 10% of the following months production.

At June 30th, 26,000 pounds of material are on hand.

Material cost is $0.80 per pound.

Half of each months purchases is paid for in the month of purchase; the other half is paid in the following month.

June 30th accounts payable balance is $12,000

Each unit of product requires .05 hours (3 minutes) of direct labor.

Each worker makes $20 per hour.

MOH is applied to units of product based on direct labor hours.

Variable MOH rate is $10 per direct labor hour.

Fixed MOH is 100,000 per month which includes $30,000 of depreciation.

Variable Selling and Administrative expenses are $2.00 per unit.

Fixed Selling and Administrative expenses are $120,000 per month of which $30,000 is depreciation.

Funkys can borrow up to $200,000 at a MONTHLY rate of 1%.

Must Maintain a minimum cash balance of $60,000.

If money is borrowed, it is borrowed on the first day of a month and repaid on the last day of a month.

Dividends paid in August totaled $50,000.

Purchased Equipment of $150,000 in August and $50,000 in September.

July 1st cash balance is $50,000

Required: Prepare a master budget for the third quarter of Funkys Music Factory.

(You do not need to complete a budgeted balance sheet.)

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