Conrad Manufacturing is preparing its master budget for the first quarter of the upcoming year. The following data pertain to

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Requirement $1.$ Prepare a schedule of cash collections for January, February, and March, and for the quarter in total.

Conrad Manufacturing

Cash Collections Budget

For the Quarter Ended March $31$

Cash sales

Credits sales

Total cash collections

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following month's sales $($in units$).$

d$.$ Of each month's direct material purchases, $20\%$ are paid for in the month of purchase, while the remainder is paid for in the

month following purchase. Two pounds of direct material is needed per unit at $$1\mathrm{.}50$ per pound. Ending inventory of direct

materials should be $20\%$ of next month's production needs.

e$.$ Most of the labor at the manufacturing facility is indirect, but there is some direct labor incurred. The direct labor hours per unit is

$0\mathrm{.}03.$ The direct labor rate per hour is $$13$ per hour. All direct labor is paid for in the month in which the work is performed. The

direct labor total cost for each of the upcoming three months is as follows:

f$.$ Monthly manufacturing overhead costs are $$6,500$ for factory rent, $$2,900$ for other fixed manufacturing expenses, and $$1\mathrm{.}40.$ per

unit for variable manufacturing overhead. No depreciation is included in these figures. All expenses are paid in the month in which

they are incurred.

g$.$ Computer equipment for the administrative offi$$s will be purchased in the upcoming quarter. In January, Conrad Manufacturing

will purchase equipment for $$5,800($cash$),$ while February's cash expenditure will be $$11,600$ and March's cash expenditure will

be $$15,800.$

h$.$ Operating expenses are budgeted to be $$1\mathrm{.}20$ per unit sold plus fixed operating expenses of $$1,400$ per month. All operating

expenses are paid in the month in which they are incurred.

i$.$ Depreciation on the building and equipment for the general and administrative offices is budgeted to be $$4,900$ for the

entire quarter, which includes depreciation on new acquisitions.

j$.$ Conrad Manufacturing has a policy that the ending cash balance in each month must be at least $$4,400.$ It has a line of credit

with a local bank. The company can borrow in increments of $$1,000$ at the beginning of each month, up to a total outstanding loan

balance of $$160,000.$ The interest rate on these loans is $1\%$ per month simple interest $($not compounded$).$ The company would

pay down on the line of credit balance in increments of $$1,000$ if it has excess funds at the end of the quarter. The company

would also pay the accumulated interest at the end of the quarter on the funds borrowed during the quarter.

k$.$ The company's income tax rate is projected to be $30\%$ of operating income less interest expense. The company pays $$10,800$

cash at the end of February in estimated taxes.