A relatively new company, Wine To End Whining, Inc., has determined they need to engage in a budgeting process as part of their new strategic plan. The Company has asked you to provide the following items for the months of January, February, and March of 2021: A) a Purchases Budget; B) a Cash Budget; C) a Budgeted Income Statement; and D) a Budgeted Balance Sheet. They have provided you with the planning document below and also, with their December 31, 2020 Balance Sheet. Please complete the four items requested on Worksheet Tabs A, B, C, and D of this Workbook. Check Figures are provided for you on each Worksheet.
		WINE TO END WHINING, INC.
		PLANNING DATA FOR 2021
		All Sales are on Credit
		Collections of Accounts Receivable:
Month of Service	55.00%
Month following Service	45.00%
Actual December 2020 Sales	$ 200,000
Expected Sales in Dollars
January	$ 220,000
February	$ 193,000
March	$ 178,000
April	$ 201,000
Cost of Goods Sold as a percentage of selling price.	65.00%
Planned ending inventory as a percentage of next month's required inventory.	72.00%
Purchases are are all on credit.
Purchases paid in current month	34.00%
Purchases paid in next month	66.00%
Sales commission as a percent of sales	2.50%
Sales commission are paid one month after the month incurred.
Advertising expenses have a fixed and variable portion:
Fixed portion	$4,200
The fixed portion of the advertising is paid in the current month.
Variable portion as a percentage of sales	1.00%
The variable portion is paid one month after the month incurred.
Insurance policy:
Months of insurance coverage paid for	12
The policy period is from February 1 to January 31 each year
The premium to be paid on February 1, 2021 is	$18,000
The premium will be charged to prepaid insurance
Selling and Administrative expenses have a fixed and variable portion:
Fixed portion is paid in the month incurred	$29,000
Variable portion as a percentage of sales	2.00%
Variable S&A expenses are paid one month after the month incurred
Depreciation expense per month	$5,000
The annual interest rate on the long term debt is	4.50%
Interest is incurred on the principal balance outstanding each month.
Interest is paid on a quarterly basis. Interest for December to February will be paid March 1.
No principal payments are scheduled to be made on the long-term debt until September of 2021
Income Tax Rate	21.00%
Accrued taxes are paid on the 15th of January, April, July and October
The Company's Board of Directors plans to declare a dividend on January 20	$12,000
It will be paid on February 15.

Use the information provided on the December 31, 2020 Balance Sheet shown below to help you create the budgeting documents requested.
WINE TO END WHINING, INC.
BALANCE SHEET
December 31, 2020
ASSETS
Current Assets
Cash	103,200
Accounts Receivable	90,000
Inventory	102,960
Prepaid Insurance	1,500
Total Current Assets	297,660
Property Plant and Equipment
Office Equipment	300,000
Accumulated Depreciation	(60,000)
Total Property Plant and Equipment	240,000
Total Assets	537,660
LIABILITIES AND SHAREHOLDERS EQUITY
LIABILITIES
Current Liabilities
Accounts Payable - Purchases	91,978
Sales Commission Payable	5,000
Selling and Admin Payable	4,000
Advertising Payable	2,000
Interest Payable	600
Dividends Payable	-
Income Taxes Payable	12,970
Total Current Liabilities	116,548
Long Term Debt	160,000
Total Liabilities	276,548
SHAREHOLDERS' EQUITY
Common Stock	124,000
Retained Earnings	137,112
Total Shareholders' Equity	261,112
Total Liabilities and Shareholders Equity	537,660

Check figures are: January Total Assets = $545,053; February Total Liabilities = $259,238; March Total Current Assets = $331,414.

Please fill in the following below:

Feb 28,2021 Mar 31, 2021 Cash 9 Solution: 10 WINE TO END WHINING, INC. 11 BUDGETED BALANCE SHEETS 12 13 ASSETS 14 Dec 31, 2020 Jan 31, 2021 15 Current Assets 16 $ 103,200 17 Accounts Receivable 90,000 18 Inventory 102,960 19 Prepaid Insurance 1,500 20 21 Total Current Assets 297,660 22 23 Property Plant and Equipment 24 Office Equipment 300,000 25 Accumulated Depreciation (60,000) 26 Total Property Plant and Equipment 240,000 27 28 Total Assets $ 537,660 29 30 LIABILITIES AND SHAREHOLDERS EQUITY 31 LIABILITIES 32 Current Liabilities 33 Accounts Payable - Purchases $ 91,978 34 Sales Commission Payable 5,000 35 Selling and Admin Payable 4,000 36 Advertising Payable 2,000 37 Interest Payable 38 Dividends Payable 39 Income Taxes Payable 12,970 40 41 Total Current Liabilities 116,548 42 43 Long Term Debt 160,000 44 45 Total Liabilities 276,548 46 47 SHAREHOLDERS' EQUITY 48 Common Stock 124,000 49 Retained Earnings 137,112 50 51 Total Shareholders' Equity 261,112 52 53 Total Liabilities and Shareholders Equity $ 537,660 54 600 55