ACCT_3500: HR Managerial Accounting MiniCase_4_1341 Greenhouse Garden Supplies Inc. sells gardening materials and supplies. George Houston, the company president is worried about cash needs for the second quarter. The company usually needs to borrow money during this quarter to support peak sales of gardening equipment, which occur during April and May. The following information has been assembled to assist in preparing a cash budget for the quarter: Budgeted monthly income statements for April to July 2022 are: George is interested in knowing how reducing inventory levels and collecting accounts receivable sooner will impact the cash budget. The cash collection and ending inventory assumptions are as follows: a. Sales continue to be 20% for cash and 80% on credit. However, experience indicates that credit sales are collected over three months with 25% collected in the month of sale, 65% collected in the month following sale, and 10% in the second month following sale. Credit sales from February and March 2022 totaled $200,000, and $300,000 respectively, and are collected during the second quarter using the collection percentages specied. b. Cost of Goods Sold in the above statement represents the cost of inventory. The company maintains its ending inventory levels for at 15% of the cost of merchandise to be sold in the following month. The merchandise inventory on 1 March 31 remains $84,000 and accounts payable for inventory purchases on the same date remain $126,000. c. Inventory purchases are paid in two installments. Fifty percent of a month's inventory purchases are paid for in the month of purchase. The remaining 50% is paid in the following month d. Dividends of $56,000 will be declared and paid in April. e. A delivery van costing $36,000 will be purchased for cash in May. f. The cash balance on March 31 is $42,000; the company must maintain a cash balance of at least $40,000 at the end of each month. 9. The company has an agreement with Prime Bank LLC that allows the company to borrow in increments of $1,000 at the beginning of each month, up to a total loan balance of $200,000. The interest rate on these loans is 1% per month and the company would, as far as it is able, repay the loan plus accumulated interest whenever cash becomes sufcient for repayment. Required: 1. Using the president's new assumptions, prepare a schedule of expected cash collections for April, May, and June, and the quarter in total. 2. Using the president's new assumptions, prepare the following for merchandise inventory: a. A merchandise purchases budget for April, May, and June. b. A schedule of expected cash disbursements for merchandise purchases for April, May, and June, and the quarter in total. 3. Using the president's new assumptions, prepare a cash budget for April, May, and June, and for the quarter in total