Bonkowski Corporation makes one product and has provided the following information to help prepare the master budget for the next four months of operations: Credit sales are collected:30% in the month of the sale70% in the following monthRaw materials purchases are paid:30% in the month of purchase70% in the following monthThe ending finished goods inventory should equal 30% of the following month's sales. The ending raw materials inventory should equal 10% of the following month's raw materials production needs.The estimated selling and administrative expense for February is closest to:

A) $71,470
B) $37,200
C) $107,200
D) $70,000

To prepare the master budget, we need to consider the following components:

1. Sales budget:
Month Sales Collection (30%) Collection (70%)
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Jan $100 $30 $70
Feb $150 $45 $105
Mar $200 $60 $140
Apr $120 $36 $84

2. Production budget:
Month Sales Ending FG Inventory Total Units Required Production Needed
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Feb $150 45 (30%) 158 163
Mar $200 48 (30%) 172 180
Apr $120 36 (30%) 130 134
May 156 166

3. Raw materials budget:
Month Production Needed Ending RM Inventory Total RM Required Purchases (30%) Purchases (70%)
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Feb 163 14 (10%) 163 49 114
Mar 180 16 (10%) 180 54 126
Apr 134 15 (10%) 134 40 94
May 166 50 116

4. Selling and administrative expense budget:
Month Budget Amount
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Feb $107,200
Mar $110,000
Apr $118,000
May $120,000

The estimated selling and administrative expense for February is closest to $107,200 (option C).