1. Use your plan of action to solve each problem, clearly outlining the procedures used, providing a concise explanation of each step, labeling relevant formulas, and showing worked out calculations and complete solutions. You may use an Excel spreadsheet or a calculator to help you perform the necessary calculations, but all corresponding work must be shown completely.

2. Answer all questions posed in the problem; if applicable, analyze and evaluate your results and provide a contextual explanation of the solutions you obtained.

3. Review your calculations and solutions and make sure that an external viewer would be able to follow your methodology and make sense of your calculations and corresponding explanations. Make certain that you have completed all steps of each problem.

Problem \#6: Operating Budgets Cathy's Cookies produces cookies for resale at local grocery stores. The company is currently in the process of establishing a master budget on a quarterly basis for this coming fiscal year, which ends December 31 . Prior year quarterly sales were as follows (1 unit = 1 batch): Unit sales are expected to increase 20%, and each unit is expected to sell for $5. Management prefers to maintain ending finished goods inventory equal to 15% of next quarter's sales. Assume finished goods inventory at the end of the fourth quarter budget period is estimated to be 2,000 units. Required: (1) Prepare a sales budget for Cathy's Cookies. (2) Prepare a production budget for Cathy's Cookies. (3) What can you interpret about Cathy's Cookies Sales Budget? Trends