$(12$ points$)$ Weldon Industrial Gas Corporation supplies acetylene and other

essed gases to industry. Data regarding the store's operations follow:

The company sells each unit for $$55.$

Budgeted Sales:

Collections are expected to be $70\%$ in the month of sale, $30\%$ in the

month following the sale.

The $\frac{A}{R}$ balance at September $30$th will be collected in full in

October.

The cost of the merchandise is $$43$ per unit.

In addition to meeting the current month's sales demand, management

wants to maintain and ending inventory balance of $10\%$ of the next

month's sales.

The beginning inventory balance at October $1$ st is $3,200$ units.

Payment for merchandise is made as follows: $\frac{1}{2}$ paid in the month of

the purchase, $\frac{1}{2}$ paid the month following the purchase.

The A$/$P balance at September $30$th will be paid in full in October.

A dividend was paid in October for $$550,000.$

Minimum cash balance is $$100,000.$

The company has a line of credit for $$500,000$ at an annual interest

rate of $12\%.$ You can borrow any amount to get to the minimum of

$$100,000.$

Loans are taken out on first day of month borrowed and repaid at

the end of the quarter with interest.

Balance Sheet

September $30$

Assets

Liabilities and Stockholders' Equity

Accounts payable

$$300,000$

Common stock

Retained earnings

Total liabilities and stockholders' equity

$[582,000],[472,000],[$$$1,354,000]$

Required:

a$.$ Prepare a Sales Budget for October, November, December, and Quarter.

b$.$ Prepare a Schedule of Expected Cash Collections for October, November,

December, and Quarter.

c$.$ Prepare a Merchandise Purchases Budget for October, November, December,

and Quarter.

d$.$ Prepare a Schedule of Expected Cash Disbursements for October, November,

December, and Quarter.

e$.$ Prepare Cash Budgets for October, November, December, and Quarter$\mathrm{.}2.(12$

points$)$ Weldon Industrial Gas Corporation supplies acetylene and other

compressed gases to industry. Data regarding the store's operations follow:

$$ The company sells each unit for $$55.$

Budgeted Sales:

Month October November December January

Sales in Units $32,00028,00040,00030,000$

$$ Collections are expected to be $70\%$ in the month of sale, $30\%$ in the

month following the sale.

$$ The A$/$R balance at September $30$th will be collected in full in

October.

$$ The cost of the merchandise is $$43$ per unit.

$$ In addition to meeting the current month$$s sales demand, management

wants to maintain and ending inventory balance of $10\%$ of the next

month$$s sales.

$$ The beginning inventory balance at October $1$st is $3,200$ units.

$$ Payment for merchandise is made as follows: $(1)/(2)$ paid in the month of

the purchase, $(1)/(2)$ paid the month following the purchase.

$$ The A$/$P balance at September $30$th will be paid in full in October.

$$ A dividend was paid in October for $$550,000.$

$$ Minimum cash balance is $$100,000.$

$$ The company has a line of credit for $$500,000$ at an annual interest

rate of $12\%.$ You can borrow any amount to get to the minimum of

$$100,000.$

$$ Loans are taken out on first day of month borrowed and repaid at

the end of the quarter with interest.

Balance Sheet

September $30$

Assets

Cash.............................................................................................. $ $100,000$

Accounts receivable $.....................................................................250,000$

Inventory $......................................................................................137,600$

Property, plant and equipment

$($net of $$200,000$ accumulated depreciation$)............................866,400$

Total assets $...................................................................................$ $$1,354,000$

Liabilities and Stockholders$$ Equity

Accounts payable $.........................................................................$ $ $300,000$

Common stock $.............................................................................582,000$

Retained earnings $.........................................................................472,000$

Total liabilities and stockholders$$ equity $.....................................$ $$1,354,000$

Required:

a$.$ Prepare a Sales Budget for October, November, December, and Quarter.

b$.$ Prepare a Schedule of Expected Cash Collections for October, November,

December, and Quarter.

c$.$ Prepare a Merchandise Purchases Budget for October, November, December,

and Quarter.

d$.$ Prepare a Schedule of Expected Cash Disbursements for October, November,

December, and Quarter.

e$.$ Prepare Cash Budgets for October, November, December, and Quarter.