All selling and administrative expenses are paid during the month, in cash, with the exception of depreciation and insurance. Insurance is paid on an annual basis, in November of each year. The company plans to purchase $16,000 in new equipment during May and $40,000 in new equipment during June; both purchases will be paid in cash. The company declares dividends of $15,000 each quarter, payable in the first month of the following quarter. The companys balance sheet at March 31 is given below: Assets Cash $ 74,000 Accounts receivable ($26,000 February sales; $320,000 March sales) 346,000 Inventory 104,000 Prepaid insurance 21,000 Fixed assets, net of depreciation 950,000 Total assets $1,495,000 Liabilities and Shareholders Equity Accounts payable $ 100,000 Dividends payable 15,000 Common shares 800,000 Retained earnings 580,000 Total liabilities and shareholders equity $1,495,000 The company wants a minimum ending cash balance each month of $50,000. All borrowing is done at the beginning of the month, with any repayments made at the end of the month. The interest rate on these loans is 1% per month and must be paid at the end of each month based on the outstanding loan balance for that month. Required:Prepare a master budget for the three-month period ending June 30. Include the following detailed budgets: 1. A sales budget by month and in total. 2. A schedule of expected cash collections from sales, by month and in total. 3. A merchandise purchases budget in units and in dollars. Show the budget by month and in total. 4. A schedule of expected cash disbursements for merchandise purchases, by month and in total. A budgeted income statement for the three-month period ending June 30. Use the variable costing approach.