8-27 Cash Collections; Cash Disbursements; Budgeted Balance Sheet (LO8-2, LO8-3, LO8-4, LO8-10] Deacon Company is a merchandising company that is preparing a budget for the three-month period ended June 30. The following information is available Deacon Company Balance Sheet March 31 Assets Cash Accounts receivable Inventory Buildings and equipment, net of depreciation Total assets Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings Total liabilities and stockholders' equity 65,200 38,800 43,300 125,000 $ 272,300 $ 66,200 70,000 136,100 $ 272,300 Budgeted Income Statements April Sales $111,000 May $121,000 June $141,000 Cost of goods sold 66,600 72,600 84,600 Gross margin 44,400 48,400 56,400 Selling and administrative expenses_ 23,300 24,800 27,800 Net operating income $ 21,100 $ 23,600 $ 28,600 Budgeting Assumptions: a. 60% of sales are cash sales and 40% of sales are credit sales. Twenty percent of all credit sales are collected in the month of sale and the remaining 80% are collected in the month subsequent to the sale. b. Budgeted sales for July are $151,000. c. 10% of merchandise inventory purchases are paid in cash at the time of the purchase. The remaining 90% of purchases are credit purchases. All purchases on credit are paid in the month subsequent to the purchase. The accounts payable at March 31 will be paid in April. d. Each month's ending merchandise inventory should equal $10,000 plus 50% of the next month's cost of goods sold. e. Depreciation expense is $1,600 per month. All other selling and administrative expenses are paid in full in the month the expense is incurred. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Calculate the expected cash collections for April, May, and June. Total cash collections April May June Quarter Required 1 Required 2 Required 3 Required 4 Calculate the budgeted merchandise purchases for April, May, and June. April Budgeted merchandise purchases May June Total Required 1 Required 2 Required 3 Required 4 Calculate the expected cash disbursements for merchandise purchases for April, May, and June. Budgeted cash disbursements for merchandise purchases April May June Quarter Required 1 Required 2 Required 3 Required 4 Prepare a budgeted balance sheet at June 30. (Hint: You need to calculate the cash paid for selling and administrative expenses during April, May, and June to determine the cash balance in your June 30 balance sheet.) Deacon Company Balance Sheet June 30 Assets Total assets Liabilities and Stockholders' Equity $ 0 Total liabilities and stockholders' equity $ 0