ie as a management various retail outlets located in shopping malls across the country. In the past, the company has done very little in the way of budgeting and at certain times of the year has experienced a shortage of cash Since you are well trained in budgeting, you have decided to prepare comprehensive budgets for the upcoming second quarter in order to show management the benefits that can be gained from an integrated budgeting program. To this end, you have worked with accounting and other areas to gather the information assembled below. The company sells many styles of earrings, but all are sold for the same price-S13 per pair. Actual sales of earrings for the last three months and budgeted sales for the next six months follow (in pairs of earrings 51,400 21,400 June (budget) January (actual) 31,400 27,400 July (budget) February (actual) 29,400 41,400 August (budget) March (actual) 66,400 September (budget 26,400 April (budget) 101,400 May (budget) The concentration of sales before and during May is due to Mother's Day su inventory should be on hand at the end of each month to supply 40% of the earrings sold in the following month. Suppliers are paid $4.7 for a pair of earrings. One-half a month's purchases is paid for in the month of purchase; the other half is paid for in the following of discount and month. All sales are on credit, with no payable within 15 days. The company has found, however, that only 20% of a month's sales are collected in the month of sale. An additional 70% is collected in the following month, and the remaining 10% is collected in the second month following sale. Bad debts have been negligible. Monthly operating expenses for the company are given below: Variable 4% of sales Sales commissions Fixed 270,000 Advertising 25,000 120,000 Salaries 10,500 Utilities 3,700 Insurance