Pet Stop Inc., a pet wholesale supplier, was organized on May 1. Projected sales for each of the first three months of operations are as follows: May $220,000 June 320,000 July 420,000 All sales are on account. Of sales on account, 53% are expected to be collected in the month of the sale, 42% in the first month following the sale, and the remainder in the second month following the sale. Prepare a schedule indicating cash collections from sales for May, June, and July.

Steele bicycle manufacturing company currently produces the handlebars used in manufacturing its bicycles, which are high-quality racing bikes with limited sales. steele produces and sells only 10,000 bikes each year. due to the low volume of activity, steele is unable to obtain the economies of scale that larger producers achieve. for example, steele could buy the handlebars for $31 each: they cost $34 each to make. the following is a detailed breakdown of current production costs: after seeing these figures, steele's president remarked that it would be foolish for the company to continue to produce the handlebars at $34 each when it can buy them for $31 each. calculate the total relevant cost. do you agree with the president's conclusion?