The estimated sales in cakes for Mihal Bakery for the period January to May are as follows: January 700 February 800 March 400 April May 300 600 The selling price of each cake is AED70. All sales are on credit with 40% of sales to be collected in the month of sale, 55% in the month following the sale and the remaining 5% to be considered as uncollectible. Sales for December were AED40,000. The company maintains finished goods inventories equal to 20% of the following month's sales. Each cake requires 4 pounds of ingredients. The company requires that the ending inventory of ingredients be equal to 40% of the following month's production needs. The ingredients cost AED3.50 per pound. The company pay 50% of a month's purchases of ingredients in the month of purchase and the remainder is paid in the following month. The accounts payable on December 31 were AED16,000. 1. Prepare a sales budget, by month and in total, for the first quarter. Show your budget in both units and AED. (5 marks) 2. Prepare a schedule of expected cash collections, by month and in total, for the first quarter. (12 marks) 3. Prepare a production budget for each of the period January to April. (15 marks) 4. Prepare a direct materials budget, by month and in total, for the first quarter. (18 marks) 5. Prepare a schedule of expected cash disbursements for materials, by month and in total, for the first quarter. (15 marks) 6. Prepare a cash budget (20 marks) for the first quarter taking into consideration the following: Rent of AED9,000 will be paid each month Wages and Salaries expenses are AED8,000 each month New equipment costing AED35,000 will be purchased and paid for in February. Minimum cash balance of AED20,000 is required at the end of each month The company has an agreement with a local bank that allows it to borrow in increments of AED1,000 (ie. if they need AED3,500 they will have to borrow AED4,000) at the beginning of month. The interest rate on these loans is 12% per year. The company would repay the loan plus accumulated interest at the end of the quarter, provided the minimum cash balance requirement is met. The beginning cash balance on January 1 was AED18,000. Cover Page/Table of Contents/Appropriate Use of Excel: 15 marks