Milo-Freeze Company manufactures and sells a product that has seasonal variations in demand, with peak sales coming in the third quarter. The following information concerns operations for Year 2- the coming year- and for the first two quarters of Year 3: a) The company's single product sells for $10 per unit. Budgeted sales in units for the next six quarters are as follows: Year 2 Quarter 2 3 60,000 100,000 Year 3 Quarter 1 2 Budgeted unit sales 40,000 50,000 70,000 80,000 b) Sales are collected in the following pattern: 75% in the quarter the sales are made, and the remaining 25% in the following quarter. On January 1, Year 2, the company's balance sheet showed $65,000 in accounts receivable, all of which will be collected by the end of first quarter. Bad debts are negligible and can be ignored. c) The company desires an ending inventory of finished units on hand at the end of each quarter equal to 30% of the budgeted sales for the next quarter. On December 31, Year 1, the company had 12,000 units on hand. d) Six pounds of raw materials are required to complete one unit of product. The company requires an ending inventory of raw materials on hand at the end of each quarter equal to 10% of the production needs of the following quarter. On December 31, Year 1, the company had 23,000 pounds of raw materials on hand. e) The raw material costs $0.80 per pound. Purchases of raw material are paid for in the following pattern: 60% paid in the quarter the purchases are made, and the remaining 40% paid in the following quarter. Ón January 1, Year 2, the company's balance sheet showed $81,500 in accounts payable for raw material purchases, all of which will be paid for in the first quarter of the year. Overall Requirements Prepare the following budgets and schedules for the year, showing both quarterly and total figures: 1. A sales budget. 2. A cash collections budget. 3. A production budget. 4. A direct materials budget. 5. Cash payments for purchases of materials schedule.