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 Sales in Units October November 30,000 25,000 . month following the sale. December January 40,000 30,000 Collections are expected to be 70% in the month of sale, 30% in the 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, 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.............. Accounts receivable..... Inventory Property, plant and equipment (net of $200,000 accumulated depreciation). Total assets. Liabilities and Stockholders' Equity Accounts payable Common stock. Retained earnings Total liabilities and stockholders' equity. $ 100,000 250,000 114,000 866,400 $1,330,400 $ 300,000 582,000 448,400 $1,330,400