Vaughn Company prepares monthly cash budgets. Relevant data from operating budgets for 2022 are as follows. January February Sales $446,400 $496,000 Direct materials purchases 148,800 155,000 Direct labor 111,600 124,000 Manufacturing overhead 86,800 93,000 Selling and administrative expenses 97,960 105,400 All sales are on account. Collections are expected to be 50% in the month of sale, 30% in the first month following the sale, and 20% in the second month following the sale. Sixty percent (60%) of direct materials purchases are paid in cash in the month of purchase, and the balance due is paid in the month following the purchase. All other items above are paid in the month incurred except for selling and administrative expenses that include $1,240 of depreciation per month.