The Master Budget 567 P9-59A Comprehensive summary problem {Learning Objectives 2 & 3) Birdleeders Unlimited makes backyard birdfeeders. The company sells the birdfeedem to home improvement stores for $15 per birdfeeder. Each birdleeoler requires 1.5 board feet of wood, which the company obtains at a cost of $4 per board foot. The company would like to maintain an ending stock of wood equal to 10% of the next month's production ,. requirements. The company would also like to maintain an ending stock otfinished bird- ' feeders equal to 20% of the next month's sales. Sales data for the company is as follows: Units 51': October actual sales (prior year) ....... 92,000 ,1: November actual sales {prior year) 85,000 2. December actual sales (prior year] 73,000 '0 January projected sales 30,000 February projected sales" 90,000 March projected sales ?5,000 April projected sales 105,000 In any given month. 20% of the total sales are cash sales, while the remainder are credit sales. The company's collection history indicates that 80% of credit sales is collected in the month after the sale. 10% is collected two months after the sale, 6% is collected three months after the sale, and the remaining 4'36 is never collected. Assume that the total cost of direct materials purchases in December was $550,000. The company pays 45% of its direct materials purchases in the month of purchase and pays the remaining 55% in the month after purchase. Requirements Prepare the following budgets 'For the first three months of the year. as well as a summary budget for the quarter: 1. Prepare the sales budget. including a separate section that details the type of sales made (cash versus credit). 2. Prepare the production budget. 3. Prepare the direct materials purchases budget. Assume the company needs 120,000 board feet oi wood for production in April. 4-. Prepare the cash collections budget for January, February. and March, as well as a summary for the rst quarter. 5. Prepare the cash payments budget for direct materials purchases for the months of f _ January. February, and March, as well as a summary for the first quarter