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QUESTION #2 Dhaliwal Company prepares monthly cash budgets. Information from the operating budgets for 2021 are as follows: March April Sales $350,000 $400,000 Direct materials purchases 120,000 110,000 Direct labour 85,000 115,000 Manufacturing overhead 60,000 75,000 Selling and administrative expenses 75,000 80,000 All sales are on account. The company expects collections to be 60% in the month of sale, 30% in the first month following the sale, and 10% in the second month following the sale. It pays 30% of direct materials purchases in cash in the month of purchase and the balance due in the month following the purchase. It pays all other items above in the month incurred. Depreciation has been excluded from manufacturing overhead and selling and administrative expenses. Additional information: 1. Credit sales: January 2021, $200,000; February 2021, $280,000 2. Purchases of direct materials: February 2021, $90,000 3. Other receipts: Marchcollection of January 31, 2021, interest receivable, $3,000; April-proceeds from sale of securities, $5,000 4. Other disbursements: April-payment of $20,000 cash for land The company's cash balance on March 1, 2021, is expected to be $50,000. The company wants to keep a minimum cash balance of $40,000. Required a. Prepare schedules for (1) the expected collections from customers and (2) the expected payments for direct materials purchases. b. Prepare a cash budget for March and April, with columns for each month

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