Go Fly a Kite Inc. specializes in manufacturing deluxe kites. Peak sales for one of their products, occur in August every year. The company has estimated the following sales: Month Expected sales in units July 40,000 August 60,000 September 30,000 October 20,000 November 20,000 The company sells the kites for $25. Based on history, the company expects that 20% of sales are cash. Of the credit sales, half is collected the month of sale and the remainder is collected one month after sale. Accounts receivable as at June 30th was $100,000; all of which is expected to be collected in July. To protect against inventory shortages (in case sales are higher than expected), the company has a policy that ending finished goods inventory is 20% of the following month's sales. The company had ending inventory on June 30th of 12,000 kites. Each kite requires 2 meters of nylon (direct materials). The cost per meter is $5.00. The company wants to ensure it has always enough direct materials on hand and therefore has indicated that ending inventory will be 25% of the following month's production needs for plastic. The company had 8,000 meters of direct materials on hand as at May 1st. The company puts all purchases of direct materials on account and pays for it the month following purchase. Purchases of materials in June amounted to $400,000. Due to the design, the company uses substantially all machine work to create the kites. Each kite only takes 0.5 hours of direct labor and the direct labor rate per hour is $15.00. The company expects to incur $100,000 of operating expenses each month. In addition, the company will record $20,000 of depreciation expense for the manufacturing facility and equipment. The company plans to purchase a new piece of equipment in June in anticipation of the busier summer season. They will pay $100,000 cash in July and the remaining $100,000 in August. There is a minimum cash balance set by management of $10,000 at the end of each month. The company has access to a line of credit. Any borrowings and repayments must be made in multiples of $1,000. The company is subject to a 4% annual interest rate. For simplicity, assume interest is not compounded. Assume that borrowings are made at the beginning of the month and repayments are made at the end of the month. The company had $30,000 in the bank account on June 30th. Using this information complete the following budgets for the third quarter of the year: a) Sales budget b) Production budget c) Direct materials budget d) Direct labour budget e) Manufacturing overhead budget f) Selling and administrative expenses budget g) Cash budget