On March 31, Sterling Enterprises,a merchandising firm, had an inventory of 38,000 units, and it had accounts receivable totaling $85,000.

Sales, in units, have been budgeted as follows for the next four months:

Month	Sales (units)
April	60,000
May	75,000
June	90,000
July	81,000

Sterlings board of directors has established a policy to commence in April that the inventory at the end of month should contain 40% of the units required for the following months budgeted sales.

The selling price is $2 per unit. One-third of sales are paid for by customers in the month of the sales; the balance (remaining) is collected in the following month.

Required

1. According to purchase budget, how many units should be purchased for each of the months April, May and June?
2. Prepare a schedule of expected cash collections for each of the months April, May and June.