1) Dcor-8 sells specialty paints and wallpaper. As the firms new cost accountant, one of your first jobs is to prepare the monthly master budget for April, based on the information available below:

Dcor-8 Balance Sheet March 31,2015
Assets
Cash	$ 25,500
Accounts receivable	90,000
Inventory	28,800
Building and equipment (net)	200,000
Total assets	$344,300
Liabilities and Stockholders Equities
Accounts payable	$ 53,760
Dividends payable	13,500
Capital stock	265,000
Retained earnings	12,040
Total liabilities and stockholders equities	$344,300

The firm had $120,000 of sales for March, and expects budgeted sales of $360,000 (April), $200,000 (May), and $180,000 (June).

Sales are 25% for cash and 75% on credit. All credit sales are collected in the month following the sale. There are no expected bad debts.

The gross margin is 60% of sales. The desired ending inventory is equal to 20% of the following month's sales.

The firm pays for 20% of its merchandise in the month when it is purchased, and the other 80% is paid the following month.

The firm has $80,000 of monthly operating expenses, which includes $7,000 of monthly depreciation expense. All other operating expenses are paid in the month they are incurred.

In April, Dcor-8 will buy new office equipment for $17,000 cash.

Dividends of $13,500 were declared at the end of March, and will be paid in April.

The firm wants to maintain a minimum cash balance of $25,000 at the end of each month, and uses a line of credit to maintain this balance. Any borrowing is made at the beginning of the month in $1,000 increments. The annual interest rate is 12%, and the interest is due when the loan is repaid.

a) Prepare a budgeted statement of cash flows for the month of April.