Milo Company manufactures beach umbrellas. The company ispreparing detailed budgets for the third quarter and has assembledthe following information to assist in the budget preparation:

1. The Marketing Department has estimated sales as follows for theremainder of the year (in units):

July	38,000	October	28,000
August	86,000	November	14,500
September	55,000	December	15,000

The selling price of the beach umbrellas is $13 per unit.

1. All sales are on account. Based on past experience, sales arecollected in the following pattern:

30%	in the month of sale
65%	in the month following sale
5%	uncollectible

Sales for June totaled $455,000.

1. The company maintains finished goods inventories equal to 15% ofthe following month’s sales. This requirement will be met at theend of June.

2. Each beach umbrella requires 4 feet of Gilden, a material thatis sometimes hard to acquire. Therefore, the company requires thatthe ending inventory of Gilden be equal to 50% of the followingmonth’s production needs. The inventory of Gilden on hand at thebeginning and end of the quarter will be:

3. Gilden costs $0.60 per foot. One-half of a month’s purchases ofGilden is paid for in the month of purchase; the remainder is paidfor in the following month. The accounts payable on July 1 forpurchases of Gilden during June will be $48,390.

4. Required:

   1. Calculate the estimated sales, by month and in total, for thethird quarter.

   2. Calculate the expected cash collections, by month and intotal, for the third quarter.

   3. Calculate the estimated quantity of beach umbrellas that needto be produced in July, August, September, and October.

   4. Calculate the quantity of Gilden (in feet) that needs to bepurchased by month and in total, for the third quarter.

   5. Calculate the cost of the raw material (Gilden) purchases bymonth and in total, for the third quarter.

   6. Calculate the expected cash disbursements for raw material(Gilden) purchases, by month and in total, for the thirdquarter.