In order for a company to be successful it has to be to create good budgets in order to ensure that ut has the money available based on collections if credit sales to pay for the raw materials and labor for products that will be sold.

To assess your understanding of the budget process, use information from the problem 7-4 on pages 325 and 326 to respond to the following requirements:

Part A

prepare a sales budget, by month and in total, for the third quarter. Your budget should be ( provided both in number of units expected to be sold and the total sales dollars.

Part B

prepare a schedule of expected cash collections, by month and in total for the third quarter.

Part C

prepare a production budget for the months of July, August, Sept, Oct. Your budget should be by month.

Part D

prepare a materials purchases budget for the company, by month and in total for the third quarter

Part E

Prepare a schedule of expected cash payments for the company by month and in total for the third quarter

Milo Company manufactures beach umbrellas. The company is now preparing detailed budgets for the third quarter and has assembled the following information to assist in the budget preparation: a. The marketing department has estimated sales as follows for the remainder of the year (in units): JulyAugustSeptemberOctoberNovemberDecember30,00070,00050,00020,00010,00010,000 The selling price of the beach umbrellas is $12 per unit. Sales in June were 25,000 units. b. All sales are on account. On the basis of past experience, sales are collected in the following pattern: Page 326 d. Each beach umbrella requires four metres of Gilden, a material that is sometimes hard to get. Therefore, the company requires that the inventory of Gilden on hand at the end of each month be equal to 50% of the following month's production needs. The inventory of Gilden on hand at the beginning and end of the quarter will be as follows: e. Gilden costs $0.80 per metre. One-half of a month's purchases of Gilden are paid for in the month of purchase: the remainder are paid for in the following month. The accounts payable on July I for purchases of Gilden during June will be $76,000. sales to pay for the raw materials and labour for products that will be sold. To a5sess your understating of the budgeting process, use the information from Problam 74 on pager 375 and 326 to respsad to the following requirenents Aeuirement Clearly label whether your colculations dre for nart A, B, C, 0 ar . Part A (2 marks) Prepare a sales budget, by month and in total, for the third quarter. Your budget should be forovided both in number of units expected to be sold and she total sales dollars. Part 3(5 marka) Prepare a schedule of expected cash collections, by month and in total for the thire guarted, Part C (A marks) Prepare a production budget for the montis af july, August, September and October. Your bucget should be by rimonthi. Part D (16 marks) Prepare a materials purchates budget for the company, by month and in total for the thired quarter. Part E(5 marks) Prepare a schedule of expected esh payments for the company by month and in tabl far the third quartere