The data below pertains to the third quarter of Al Ain Company which manufactures toys. Below is the estimated sales (in units): July 30,000 August 60,000 September 80,000 October 40,000 November 10,000 December 20,000 a. The selling price of the toys is $10 per unit. b. All sales are on account. Based on past experience, sales are collected in the following pattern: Month of sale 25% Month following sale 70% Uncollectible 5% c. Sales for June totaled $400,000. d. The company maintains finished goods inventories equal to 20% of the following month's sales. This requirement will be met at the end of June. e. Each toy requires 3 pounds of raw materials. f. The company requires that the ending inventory of raw materials be equal to 10% of the following month's production needs. g. The raw material costs $1.50 per pound. h. 40% of a month's purchases of raw materials is paid for in the month of purchase; the remainder is paid for in the following month. i. The accounts payable on June 30 will be $80,000. Part I (similar to problem 8-28) Required: Prepare: 1. Prepare a sales budget, by month and in total, for the Third quarter. (3 marks) 2. Prepare a schedule of expected cash collections, by month and in total, for the Third quarter. (15 marks) 3. Prepare a production budget for each of the months July, August, September and October. (10 marks) 4. Prepare a direct materials budget, by month and in total, for the Third quarter. (12 marks) 5. Prepare a schedule of expected cash disbursements, by month and in total, for the Third quarter. (15 marks) Total of Pat I (55 marks) Part II (Similar to problem 8-25) Required: Prepare: 1. A schedule of expected cash collections (15 marks) 2. A cash budget (20 marks) Total of Part II (35 marks) Cover Page, Introduction and formatting 1. Cover page (2 marks) 2. Table of contents (2 marks) 3. Introduction (2 marks) 4. Referencing (2 marks) 5. Formatting (2 marks)

The data below pertains to the third quarter of Al Ain Company which manufactures toys. Below is the estimated sales (in units): July August September October November December 30,000 60,000 80,000 40,000 10,000 | 20,000 a. The selling price of the toys is $10 per unit. b. All sales are on account. Based on past experience, sales are collected in the following pattern: Month following sale Uncollectible 25% 70% 5% c. Sales for June totaled $400,000. month's sales. This requirement will be met at the end of June. e. Each toy requires 3 pounds of raw materials. f. The company requires that the ending inventory of raw materials be equal to 10% of the following month's production needs. g. The raw material costs $1.50 per pound. Part I (similar to problem 8-28) Required: Prepare: (3 marks) 2. Prepare a schedule of expected cash collections, by month and in total, for the Third quarter. (15 marks) 3. Prepare a production budget for each of the months July, August, September and October. (10 marks) 4. Prepare a direct materials budget, by month and in total, for the Third quarter. (12 marks) 5. Prepare a schedule of expected cash disbursements, by month and in total, for the Third quarter. (15 marks) (55 marks) Part II (Similar to problem 8-25) Required: Prepare: 1. A schedule of expected cash collections 2. A cash budget (20 marks)