Question 1 - List and describe four potential advantages of budgeting and four potential disadvantages of budgeting. As part of your description, you should provide examples of the advantages and disadvantages.

Question 2 - The following forecasted sales pertain to Arrow Corporation:

Month                  Sales

September         $160,000

October              200,000

November          120,000

December          80,000

Collection pattern:  75 percent in month of sale; 25 percent in month following sale

Accounts Receivable (August 31):  $28,000

Finished Goods Inventory (August 31):  30,000

Arrow Corporation has a selling price of $10 per unit and expects to maintain ending inventories equal to 30 percent of the next month's sales. Calculate the budgeted beginning balance in units for finished goods inventory on November 1?

Question 3 - The forecasted sales pertain to Skifurn, Inc.:

Month                Sales

January              $900,000

February             1,000,000

March                 600,000

April                   400,000

Collection pattern:  70 percent in month of sale; 30 percent in month following the sale

Accounts Receivable (December 31):  $140,000

Finished Goods Inventory (December 31):  160,000

The company has a selling price of $10 per unit and expects to maintain ending inventories equal to 20 percent of the next month's sales. 

Calculate the amount of cash that Skifurn expects to collect in February?