MILO COMPANY Schedule of Expected Cash Collections July August September Quarter Accounts receivable, June 30 July sales August sales September sales Total cash collections $ 0 $ O S 0 $ 2. Prepare a production budget for each of the months July to October. MILO COMPANY Production Budget for July-October July August September October Total needs1O poi ms Milo Company manufactures beach umbrellas. The company Is now preparing detailed budgets for the thitd 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]: July 48,000 October 38,000 August 88,000 November 28,000 September 68,000 December 28,000 The selling price of the beach umbrellas Is $12 per unit Sales in June were 43,000 units. b. All sales are on account. On the basis of past experience. sales are collected In the following pattern: EDI in the month of sale 65' in the month following sale 5% uncollectible [9- o The company maintains nished goods Inventories equal to 15% ofthe following month's sales. This requirement will be met at the end of June. d. Each beach umbrella requires 4 metres of Gilden, a material that is sometimes hard to get. Therefore, the company requires that the Inventory of GIIden on hand It 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 ofthe quarter will be as follows: Jun! 30 10l,000 untrue September 30 2 metres 579} e. Gilden costs $0.80 per metre. Onehalf of a month's purchases of Gllden are paid for In the month of purchase; the remainder are paid for In the fotlowlng month. The accounts payable on Ju|y1 for purchases of Gilden during June will be $94,000. Required: 1. Prepare a sales budget, by month and In total, for the third quarter. Also, prepare a schedule of expected cash collections. by month and In total, forthe third quarter