Healthwatch company produces organic fig jams. The fig jam is sold in 400gram jars. The sales budget for the first seven months of the year 2022 is as follows:

Months Sales (in units)

Jan 20,000

Feb 22,000 March 14,800 April 18,000 May 17,500 June 20,000 July 12,900

Company policy requires that ending inventories for each month be 20% of next month'ssales. Each of fig jam jar needs three ingredients: 800 grams of figs, 100 grams of honey and one jar. Company policy requires that ending inventories of raw materials for eachmonth be 10% of the next month's production needs.

All materials are bought on credit from various suppliers. HealthWatch has a policy of paying for 30% of purchases in the month when the purchase took place and the outstanding balance is paid in the month after the purchase for all purchases. The company pays $0.3 per one gram of figs; $0.01 per one gram of honey and $0.85 per jar.

Required:

explain Direct material purchases budget (in units and dollars)for figs onlyfor January and February 2022. (16 marks)

1. explain the schedule indicating the payments to the fig suppliers in February 2022. (4 marks)
2. Provide two examples and discuss how behavioural factors may impact on budgeting process and outcome. (4 marks)