Solar Products Ltd manufactures and sells a single product. The following information is also available for the next 6 month period: Sales: The budgeted sales, in units, are as follows: Month July Aug Sept Oct Nov Dec Sales {units} 240 260 2T0 230 230 2T0 The standard selling price is 50 per unit. 40% are expected to be cash sales with the remaining customers allowed one month's credit. It is estimated that 5% of credit customers will be bad debts. Production: The company manufactures 50% of the budgeted sales during the month before the sale and the remaining 40% in the month of sale. Costs: (i) Direct material will be 20 per unit of the nished product. Material will be purchased in the month prior to their use in production and paid for in the following month. (ii)- Wages will be paid at the rate of 8 per unit of finished product. payable in the month of production. A bonus payment of 4 per unit will be paid on all additional monthly production in excess of 250 units, paid in the month following production. (iii) Fixed production overheads of 13,000, including depreciation of 6,000, are budgeted for the year ahead. These are budgeted to be the same each month and, apart from depreciation are payable in the month they are incurred. (iv) Variable selling expenses are expected to be 3 per unit payable in month they are incurred. (v) Fixed administration overheads of 5,000 for the year ahead are budgeted to be same per month and payable in the month they are incurred. Cash: The company expects to have a bank overdraft of 3,500 at the start of August. REQUIRED Prepare the following budgets for each of the months August to October: (a) Production (units) [3 marks) (b) Material purchases (E's) (2 marks) (c) Labour cost (3 marks) (d) Cash. {12 marks) [Total 20 marks]