Lorch Company prepares monthly cash budgets. Relevant data from operating budgets for 2021 are as follows: January February Sales $357,000 $404,000 Direct materials purchases 119.000 111,000 Direct labour 84,000 112,000 Manufacturing overhead 59,000 76,000 Selling and administrative expenses 76.000 80,000 All sales are on account. Lorch expects collections to be 50% in the month of sale. 40% 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.