Problem $8-30($Algo$)$ Integration of the Sales, Production, and Direct Materials Budgets $[$LO$8-2,$ LO$8-3,$ LO$8-4]$

Milo Company manufactures beach umbrellas. The company is preparing detailed budgets for the third quarter and has assembled the following information to assist in the budget preparation:

The Marketing Department has estimated sales as follows for the remainder of the year $($in units$)$:

July $34,000$ October $24,000$

August $78,000$ November $10,500$

September $47,000$ December $11,000$

The selling price of the beach umbrellas is $$11$ per unit.

All sales are on account. Based on past experience, sales are collected in the following pattern:

$30\%$ in the month of sale

$65\%$ in the month following sale

$5\%$ uncollectible

Sales for June totaled $$297,000.$

The company maintains finished goods inventories equal to $15\%$ of the following month$$s sales. This requirement will be met at the end of June.

Each beach umbrella requires $4$ feet of Gilden, a material that is sometimes hard to acquire. Therefore, the company requires that the ending inventory of Gilden be equal to $50\%$ of the following month$$s production needs. The inventory of Gilden on hand at the beginning and end of the quarter will be:

June $3081,200$ feet

September $30?$ feet

Gilden costs $$0\mathrm{.}80$ per foot. One$-$half of a month$$s purchases of Gilden is paid for in the month of purchase; the remainder is paid for in the following month. The accounts payable on July $1$ for purchases of Gilden during June will be $$54,920\mathrm{.}6.$ Calculate the expected cash disbursements for raw material $($Gilden$)$ purchases, by month and in total, for the third quarter.

C$1.$ alculate the expected cash disbursements for raw material $($Gilden$)$ purchases, by month and in total, for the third quarter.