Please answer all the questions with information been provide, please show steps for good mark

1. Prepare a monthly master budget for Drone Dynamics for the year ending December 31, 2021, including the following schedules:

- Direct Labour Budget

- Manufacturing Overhead Budget

- Ending Finished Goods Inventory Budget

- Selling and Administrative Expense Budget

- Cash Budget

Information below:

As part of the continued advancement of technology, a drone camera market has emerged in recent years. The drone camera market has been growing as more photography enthusiasts have begun adopted this high-tech approach to capturing still images and video using remotely controlled devices. Eager to capture a share of this growing market, Drone Dynamics entered the market in early 2019. Drone Dynamics manufacturescamera drones, selling primarily to retailers. Drone Dynamics is pleased with its financial performance over its first few years of operations, optimistic to achieve continued financial success. For planning and control purposes the company utilizes a monthly master budget, which is usually developed at least three months in advance of the budget year. The company has a fiscal year ending December 31. It is now Sept 15, 2020. You have been asked to prepare the Master Budget for the year ending December 31,2021. Based on your discussions with the various departments throughout the company, you have collected the following relevant information for preparing the budget: Sales 1. The marketing department is forecasting the following annual sales: - For the year ended December 31, 2020: 9,000 units at $1,000 each* - For the year ended December 31, 2021: 10,000 units at $1,000 each - For the year ended December 31, 2022: 15,000 units at $1,000 each * Expected sales for the year ended December 31, 2020 were based on actual sales to date and budgeted sales for the duration of the year. 2. Peak months for sales generally correspond with summer weather and gift-giving holidays. History shows that January is the slowest month, with only 1% of annual sales, followed closely behind by Feb-April with 2% of annual sales for each month. Sales spike during summer months with May, June, July, and August contributing 12%,15%,12%, and 10% of annual sales respectively. With the back-to-school focus in September, there is a significant dip in camera drone sales to 3% of annual sales. As Christmas shopping picks up momentum, winter sales increase to 8% in October, 13% in November, and then peak at 20% in December. This pattern of sales is not expected to change in the next two years. Manufacturing Costs and Inventory 3. Each camera drones spends a total of 3.5 hours in production. 4. Due to the highly technical nature of Drone Dynamics's manufacturing process, Drone Dynamics's direct labour rate averages $30.00 per hour. This rate already includes the employer's portion of employee benefits. 5. Each camera drone requires 1.25kg of direct materials. The average cost ofdirect materials is $57/kg. The supplier of the direct materials tends to be somewhat erratic, so Drone Dynamics finds it necessary to maintain a direct materials inventory balance equal to 40% of the following month's production needs as a precaution against stock-outs. 6. Due to the similarity of the equipment in each of the production stages and the company's concentration on a single product, manufacturing overhead is allocated based on volume (i.e. the units produced). The variable manufacturing overhead rate is $160/ unit, consisting of: 7. The fixed manufacturing overhead costs are as follows: Amortization is calculated using the straight-line method, with no amortization calculated in the year capital assets are acquired. 8. From previous experience, management has determined that an ending finished goods inventory equal to 25% of the next month's sales is required to efficiently meet customer demands. Collections Pattern 9. Sales are on a cash and credit basis, with 49% collected during the month of the sale, 33% the following month, and 17% the month thereafter. There are no early payment discounts for customers. Bad debt expense (amounts considered uncollectible) account for 1% of sales. 10. Based on the collection pattern described above, accounts receivable as at end of business day on December 31,2020 is projected to be $1,098,900 arising from the following estimates: Payments Pattern 11. Drone Dynamics pays for 20% of a month's purchases of direct materials in the month of purchase, 50% in the following month and the remaining 30% two months after themonth of purchase. There are no early payment discounts offered by suppliers. 12. Based on the payment pattern described above, accounts payable as at end of business day on December 31,2020 is projected to be $78,642 arising from the following estimates: 13. All payroll costs are paid in the period in which they are incurred. 14. The property and business taxes, paid at the beginning of July each year, apply to the following 12 -month period. 15. Annual insurance premiums, paid at the beginning of April each year, apply to the following 12-month period. 16. Fixed manufacturing overhead costs are incurred evenly over the year and "cashrelated N amounts are paid as incurred. 17. Selling and administrative expenses are paid in the month in which they occur. Other 18. Anticipating a significant increase in customer demand and market share over the next few years, Drone Dynamics is planning a significant expansion involving acquiring additional manufacturing equipment for $3,000,000 cash. Half of this amount is to be paid to the equipment supplier in July 2021, with the remainder to be paid in October 2021. 19. Selling and administrative expenses are known to be a mixed cost; however, there is a lot of uncertainty about the portion that is fixed. Based on prior year experience: Lowest level of monthly sales: 80 units ... Total Operating Expenses: \$87,270* Highest level of monthly sales: 1,600 units ... Total Operating Expenses: $360,780 * excluding bad debts and amounts described below 20. To secure and grow its market share, Drone Dynamics is planning to operate "pop-up" kiosks in various local retail centers during peak sales months (May-Aug, Nov-Dec)commencing Nov 2020. Drone Dynamics is budgeting $10,900 per month (including all related fees and taxes), payable at the beginning of each month, to set-up and operate these kiosks. The cost to set-up and operate "popup" kiosks will be in addition to the normal selling and administrative expenses described above and isnot expected to increase during 2021. 21. Income tax expense is estimated to be 25% of net income. Drone Dynamics makes monthly income tax installment payments of $25,000 and pays all outstanding income taxes (in excess of installment payments) in March of the following year. As such, any outstanding income tax balance for the year ended December 31, 2020 it will be paid in March 2021. 22. An arrangement has been made with the local bank that if Drone Dynamics maintains a minimum balance of $50,000 in their bank account, they will be given a line of creditat a preferred rate of 3% per annum ( 0.25% per month). All borrowing is consideredto happen on the first day of the month, repayments are on the last day of the month. All borrowings and repayments from the bank should be in multiples of $10,000 and interest must be paid at the end of each month. Interest is calculatedon the balance at the beginning of the month, which includes any amounts borrowed that month. 23. Drone Dynamics has a policy of paying dividends at the end of each quarter. The President tells you that the Board of Directors is planning on declaring dividends as follows: Dividends are paid in the month they are declared. The company is forecasting the following balances as at the end of business day on December 31, 2020: As part of the continued advancement of technology, a drone camera market has emerged in recent years. The drone camera market has been growing as more photography enthusiasts have begun adopted this high-tech approach to capturing still images and video using remotely controlled devices. Eager to capture a share of this growing market, Drone Dynamics entered the market in early 2019. Drone Dynamics manufacturescamera drones, selling primarily to retailers. Drone Dynamics is pleased with its financial performance over its first few years of operations, optimistic to achieve continued financial success. For planning and control purposes the company utilizes a monthly master budget, which is usually developed at least three months in advance of the budget year. The company has a fiscal year ending December 31. It is now Sept 15, 2020. You have been asked to prepare the Master Budget for the year ending December 31,2021. Based on your discussions with the various departments throughout the company, you have collected the following relevant information for preparing the budget: Sales 1. The marketing department is forecasting the following annual sales: - For the year ended December 31, 2020: 9,000 units at $1,000 each* - For the year ended December 31, 2021: 10,000 units at $1,000 each - For the year ended December 31, 2022: 15,000 units at $1,000 each * Expected sales for the year ended December 31, 2020 were based on actual sales to date and budgeted sales for the duration of the year. 2. Peak months for sales generally correspond with summer weather and gift-giving holidays. History shows that January is the slowest month, with only 1% of annual sales, followed closely behind by Feb-April with 2% of annual sales for each month. Sales spike during summer months with May, June, July, and August contributing 12%,15%,12%, and 10% of annual sales respectively. With the back-to-school focus in September, there is a significant dip in camera drone sales to 3% of annual sales. As Christmas shopping picks up momentum, winter sales increase to 8% in October, 13% in November, and then peak at 20% in December. This pattern of sales is not expected to change in the next two years. Manufacturing Costs and Inventory 3. Each camera drones spends a total of 3.5 hours in production. 4. Due to the highly technical nature of Drone Dynamics's manufacturing process, Drone Dynamics's direct labour rate averages $30.00 per hour. This rate already includes the employer's portion of employee benefits. 5. Each camera drone requires 1.25kg of direct materials. The average cost ofdirect materials is $57/kg. The supplier of the direct materials tends to be somewhat erratic, so Drone Dynamics finds it necessary to maintain a direct materials inventory balance equal to 40% of the following month's production needs as a precaution against stock-outs. 6. Due to the similarity of the equipment in each of the production stages and the company's concentration on a single product, manufacturing overhead is allocated based on volume (i.e. the units produced). The variable manufacturing overhead rate is $160/ unit, consisting of: 7. The fixed manufacturing overhead costs are as follows: Amortization is calculated using the straight-line method, with no amortization calculated in the year capital assets are acquired. 8. From previous experience, management has determined that an ending finished goods inventory equal to 25% of the next month's sales is required to efficiently meet customer demands. Collections Pattern 9. Sales are on a cash and credit basis, with 49% collected during the month of the sale, 33% the following month, and 17% the month thereafter. There are no early payment discounts for customers. Bad debt expense (amounts considered uncollectible) account for 1% of sales. 10. Based on the collection pattern described above, accounts receivable as at end of business day on December 31,2020 is projected to be $1,098,900 arising from the following estimates: Payments Pattern 11. Drone Dynamics pays for 20% of a month's purchases of direct materials in the month of purchase, 50% in the following month and the remaining 30% two months after themonth of purchase. There are no early payment discounts offered by suppliers. 12. Based on the payment pattern described above, accounts payable as at end of business day on December 31,2020 is projected to be $78,642 arising from the following estimates: 13. All payroll costs are paid in the period in which they are incurred. 14. The property and business taxes, paid at the beginning of July each year, apply to the following 12 -month period. 15. Annual insurance premiums, paid at the beginning of April each year, apply to the following 12-month period. 16. Fixed manufacturing overhead costs are incurred evenly over the year and "cashrelated N amounts are paid as incurred. 17. Selling and administrative expenses are paid in the month in which they occur. Other 18. Anticipating a significant increase in customer demand and market share over the next few years, Drone Dynamics is planning a significant expansion involving acquiring additional manufacturing equipment for $3,000,000 cash. Half of this amount is to be paid to the equipment supplier in July 2021, with the remainder to be paid in October 2021. 19. Selling and administrative expenses are known to be a mixed cost; however, there is a lot of uncertainty about the portion that is fixed. Based on prior year experience: Lowest level of monthly sales: 80 units ... Total Operating Expenses: \$87,270* Highest level of monthly sales: 1,600 units ... Total Operating Expenses: $360,780 * excluding bad debts and amounts described below 20. To secure and grow its market share, Drone Dynamics is planning to operate "pop-up" kiosks in various local retail centers during peak sales months (May-Aug, Nov-Dec)commencing Nov 2020. Drone Dynamics is budgeting $10,900 per month (including all related fees and taxes), payable at the beginning of each month, to set-up and operate these kiosks. The cost to set-up and operate "popup" kiosks will be in addition to the normal selling and administrative expenses described above and isnot expected to increase during 2021. 21. Income tax expense is estimated to be 25% of net income. Drone Dynamics makes monthly income tax installment payments of $25,000 and pays all outstanding income taxes (in excess of installment payments) in March of the following year. As such, any outstanding income tax balance for the year ended December 31, 2020 it will be paid in March 2021. 22. An arrangement has been made with the local bank that if Drone Dynamics maintains a minimum balance of $50,000 in their bank account, they will be given a line of creditat a preferred rate of 3% per annum ( 0.25% per month). All borrowing is consideredto happen on the first day of the month, repayments are on the last day of the month. All borrowings and repayments from the bank should be in multiples of $10,000 and interest must be paid at the end of each month. Interest is calculatedon the balance at the beginning of the month, which includes any amounts borrowed that month. 23. Drone Dynamics has a policy of paying dividends at the end of each quarter. The President tells you that the Board of Directors is planning on declaring dividends as follows: Dividends are paid in the month they are declared. The company is forecasting the following balances as at the end of business day on December 31, 2020