Royal Company is preparing budgets for the quarter ending June 30.

Budgeted sales for the next five months are:

April 20,000 units

1. May 50,000 units
2. June. 30,000 units
3. July 25,000 units
4. August. 15,000 units.

The selling price is $10 per unit and all sales are on credit. However, the March 31 accounts receivable balance of $30,000 will be collected in full. Royals collection pattern is:

• 70% collected in the month of sale,
• 25% collected in the month following sale,
• 5% is uncollectible.

Requirements:

1. Prepare sales budget
2. Prepare cash collection budget