Question 5. Claire is an accountant for ABC Sporting Equipment Pty Ltd. The company sells one type of cricket bat and has the following sales budget for that product in 2022. Q1 Q2 Q3 04 Total Expected sales units 14000 11000 12000 17000 54000 Selling Price $30 $30 $30 $30 $30 Budgeted Sales revenue $420,000 $330,000 $360,000 $510,000 $1,620,000 Claire would like to prepare a production budget. It is estimated that the beginning inventory for Q1 (2022) will be 1500 cricket bats. The bats cost $27,000 to produce in Q1 (2022). The inventory manager wants to ensure the ending inventory for each quarter is half the expected sales for the following quarter. Expected sales for Q1 (2023) are 12,500 cricket bats. Required: a.. Prepare the production budget in units for Q1, Q2, Q3 and 24 for year 2022. Show your calculations. [4 marks] . b. Prepare a materials budget for 2022. Each cricket bat requires 0.25 square metres (m2) of willow wood. The opening material inventory is 150m2 at $90 per m2. Claire wants the material inventory at the end of each quarter to increase to 450m2 at $90 per m2. The material cost is not expected to change in next year. [5 marks] C. Why it is vital for Claire to work together with her manager on the production and materials budget? [2 marks] d. What could be some differences between budget prepared for a manufacturing enterprise such as ABC and that by a retail organisation which is involved in selling cricket bats manufactured by ABC? [2 marks] e. At the end of 24 Claire finds that willow wood is actually $92 per m2 rather than the $90 per m2 she included in the materials budget. Claire believes as this is such a small difference she will not need to update the budget. Do you agree with Claire? Give reasons for your answer. [2 marks] [Total for Question 5 = 15 marks]