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Milo Company manufactures beach umbrellas

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Milo Company manufactures beach umbrellas;Milo Company manufactures beach umbrellas. The company is preparing detailed budgets for the third quarter and has assembled the following information to assist in the budget preparation;(a) The Marketing Department has estimated sales as follows for the remainder of the year (in units).;Transtutors001_a2ef6035-51f1-4f5e-94f3-3;(b)All sales are on account. Based on past experience, sales are collected in the following pattern;30% in the month of sales;65% in the month following sales;5% uncollectible;Sales for June totaled $300,000.;(c)The company maintains finished goods inventories equal to 15% of the following month?s sales. This requirement will be met at the end of June.;(d)Each beach umbrella requires 4 feet of Gilden, a material that is sometimes hard to acquire. Therefore, the company requires that the ending inventory of Gilden be equal to 50% of the following month?s production needs. The inventory of Gilden on hand at beginning and end of the quarter will be;Transtutors001_bcc5075a-0dae-465b-b621-e;(e)Gilden costs $0.80 per foot. One-half of a month?s purchases of Gilden is paid for in the month of purchase, the remainder is paid for in the following month. The accounts payable on July 1 for purchases of Gilden during June will be $76,000.;Required;1.Prepare a sales budget, by month and in total, for the third quarter. (Show your budget in both units and dollars.) Also prepare a schedule of expected cash collections, by month and in total, for the third quarter.;2. Prepare a production budget for each of the months July?October.;3. Prepare a direct materials budget for Gilden, by month and in total, for the third quarter. Also prepare a schedule of expected cash disbursements for Gilden, by month and in total, for the third quarter.;4.Cashbudget

 

Paper#28860 | Written in 18-Jul-2015

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