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 $45. Budgeted Sales: Month October November December January Sales in Units 30,000 25.000 40.000 30,000 Collections are expected to be 70% in the month of sale, 30% in the month following the sale. The A/R balance at September 30th will be collected in full in October. The cost of the merchandise is $38 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 1st is 3.000 units. Payment for merchandise is made as follows: paid in the month of the purchase, y paid the month following the purchase. The A/P balance at September 30th will be paid in full in October. A dividend was paid in October for $500,000. Minimum cash balance is $100,000. The company has a line of credit for $500,000 at an annual interest rate of 12%. 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............. $ 100,000 250.000 114,000 Accounts receivable............. Inventory ............ Property, plant and equipment (net of $200,000 accumulated depreciation). Total assets...... 866,400 $1,330,400 Liabilities and Stockholders' Equity Accounts payable........ Common stock ................ Retained earnings... Total liabilities and stockholders' equity......... $ 300,000 582,000 448.400 $1,330,400 Required: 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. Cash Budget November October $100,000 December Quarter Beginning Cash bal. +Cash collections =Cash Available Less: Cash Disburse. For Purchases Dividend =Total cash disburse. Excess/(Deficiency) Borrowing Repayment Interest Ending Cash bal