Requirement 1. Prepare a schedule of cash collections for January, February, and March, and for the quarter in total.

Dalley Manufacturing
Cash Collections Budget
For the Quarter Ended March 31
	Month

	January	February	March	Quarter
Cash sales	$24,000	$27,600	$29,700	$81,300
Credits sales	49,000	56,000	64,400	169,400
Total cash collections	$73,000	$83,600	$94,100	$250,700

Requirement 2. Prepare a production budget. (Hint: Unit sales = Sales in dollars / Selling price per unit.)

Dalley Manufacturing
Production Budget
For the Quarter Ended March 31
	Month

	January	February	March	Quarter
Unit sales	8,000	9,200	9,900	27,100
Plus: Desired ending inventory	2,300	2,475	2,425	2,425
Total needed	10,300	11,675	12,325	29,525
Less: Beginning inventory	2,000	2,300	2,475	2,000
Units to produce	8,300	9,375	9,850	27,525

Requirement 3. Prepare a direct materials budget. (Round your answers to the nearest whole dollar.)

Dalley Manufacturing
Direct Materials Budget
For the Quarter Ended March 31
	Month

	January	February	March	Quarter
Units to be produced	8,300	9,375	9,850	27,525
Multiply by: Quantity (pounds) of DM needed per unit	2	2	2	2
Quantity (pounds) needed for production	16,600	18,750	19,700	55,050
Plus: Desired ending inventory of DM	3750	3940	4490	4490
Total quantity (pounds) needed	20350	22690	24190	59540
Less: Beginning inventory of DM	3320	3750	3940	3320
Quantity (pounds) to purchase	17030	18940	20250	56220
Multiply by: Cost per pound	$2.00	$2.00	$2.00	$2.00
Total cost of DM purchases	34060	37880	40500	112440

a.Actual sales in December were 70,000. Selling price per unit is projected to remain stable at 10 per unit throughout the budget period. Sales for the first five months of the upcoming year are budgeted to be as follows: January . . . . . . . . $ 80,000 February . . . . . . . $ 92,000 March . . . . . . . . . $ 99,000 April . . . . . . . . . . $ 97,000 May . . . . . . . . . . $ 85,000 b.Sales are 30% cash and 70% credit. All credit sales are collected in the month following the sale. c. Dalley Manufacturing has a policy that states that each month's ending inventory of finished goods should be 25% of the following month's sales (in units). d.Of each month's direct material purchases, 20% are paid for in the month of purchase, while the remainder is paid for in the month following purchase. Two pounds of direct material is needed per unit at $2 per pound. Ending inventory of direct materials should be 10% of next month's production needs. e.Most of the labor at the manufacturing facility is indirect, but there is some direct labor incurred. The direct labor hours per unit is 0.01. The direct labor rate per hour is $12 per hour. All direct labor is paid for in the month in which the work is performed. The direct labor total cost for each of the upcoming three months is as follows:

January . . . . . . . . $ 996 February . . . . . . . $ 1,125 March . . . . . . . . . $ 1,182

I am having problem with calculating the italicized numbers, all of the bolded italicized are wrong apparently.