Question No 3: Willey Company prepares monthly cash budget. Relevant data from operating budgets for 2018 are: January February Sales $320,000 400,000 Merchandise purchases 80,000 110,000 Direct labor 85,000 115,000 Manufacturing overhead 75,000 Selling and administrative expenses 75,000 80,000 All the sales are on account. Collections are expected to be 50% in the month of sale, 30% in the first mon following the sale and 20% in the second month following the sale. 30% of the direct materials are purchase are paid in cash in the month of purchase and the balancs due is paid in the month following the purchase All other items above are paid in the month incurred. Other dala: Credit sales: November 2017 was $200,000 and December 2017 was $280,000. Purchases of direct materials on December 2017 were 90,000. Other cash disbursements: February 2018: Payment of $20,000 for land. Cash balance on January 2018 is expected to be $60,000, The company wants to maintain a minimum balance of $50,000. For maintaining this minimu the company can borrow required financing at an annual interest rate of 12%. (Marks Requirements: Prepare the supporting schedule of expected cash collection for merchandise sales. Budget for cash disbursement for material purchase. Prepare a budget for January and February