Beech Corporation is a merchandising company that is preparing a master budget for the third quarter. The company$$s balance sheet as of June $30$th is shown below:

Beech CorporationBalance SheetJune $30$Assets$$Cash$ $73,000$Accounts receivable$125,000$Inventory$56,000$Plant and equipment, net of depreciation$221,000$Total assets$ $475,000$Liabilities and Stockholders$$ Equity$$Accounts payable$ $82,000$Common stock$309,000$Retained earnings$84,000$Total liabilities and stockholders$$ equity$ $475,000$

Beech$$s managers made the following additional assumptions and estimates:

Estimated sales for July, August, September, and October will be $$320,000,$ $$340,000,$ $$330,000,$ and $$350,000,$ respectively.

All sales are on credit and all credit sales are collected. Each month$$s credit sales are collected $35\%$ in the month of sale and $65\%$ in the month following the sale. All of the accounts receivable at June $30$ will be collected in July.

Each month$$s ending inventory must equal $25\%$ of the cost of next month$$s sales. The cost of goods sold is $70\%$ of sales. The company pays for $40\%$ of its merchandise purchases in the month of the purchase and the remaining $60\%$ in the month following the purchase. All of the accounts payable at June $30$ will be paid in July.

Monthly selling and administrative expenses are always $$40,000.$ Each month $$6,000$ of this total amount is depreciation expense and the remaining $$34,000$ relates to expenses that are paid in the month they are incurred.

The company does not plan to borrow money or pay or declare dividends during the quarter ended September $30.$ The company does not plan to issue any common stock or repurchase its own stock during the quarter ended September $30.$

Required:

$1.$ Prepare a schedule of expected cash collections for July, August, and September. Also, compute total cash collections for the quarter ended September $30.$

$2-$a$.$ Prepare a merchandise purchases budget for July, August, and September. Also, compute total merchandise purchases for the quarter ended September $30.$

$2-$b$.$ Prepare a schedule of expected cash disbursements for merchandise purchases for July, August, and September. Also, compute total cash disbursements for merchandise purchases for the quarter ended September $30.$

$3.$ Prepare an income statement for the quarter ended September $30.$

$4.$ Prepare a balance sheet as of September $30.$

Required Information

$[$The following information applies to the questions displayed below.$]$

Beech Corporation is a merchandising company that is preparing a master budget for the third quarter. The company's balance sheet as of June $30$th is shown below:

Beech's managers made the following additional assumptions and estimates:

$1.$ Estimated sales for July. August, September, and October will be $\backslash (\backslash$$ $320,000,\backslash$$ $340,000,\backslash$$ $330,000\backslash ),$ and $\backslash (\backslash$$ $350,000\backslash ),$ respectively.

$2.$ All sales are on credit and all credit sales are collected. Each month's credit sales are collected $\backslash (35\backslash \%\backslash )$ in the month of sale and $\backslash (65\backslash \%\backslash )$ in the month following the sale. All of the accounts receivable at June $30$ will be collected in July.

$3.$ Each month's ending inventory must equal $\backslash (25\backslash \%\backslash )$ of the cost of next month's sales. The cost of goods sold is $\backslash (70\backslash \%\backslash )$ of sales. The company pays for $\backslash (40\backslash \%\backslash )$ of its merchandise purchases in the month of the purchase and the remaining $\backslash (60\backslash \%\backslash )$ in the month following the purchase. All of the accounts payable at June $30$ will be paid in July.

$4.$ Monthly selling and administrative expenses are always $\backslash (\backslash$$ $40,000\backslash ).$ Each month $\backslash (\backslash$$ $6,000\backslash )$ of this total amount is depreciation expense and the remaining $\backslash (\backslash$$ $34,000\backslash )$ relates to expenses that are paid in the month they are incurred.

$5.$ The company does not plan to borrow money or pay or declare dividends during the quarter ended September $30.$ The company does not plan to issue any common stock or repurchase its own stock during the quarter ended September $30.$

Required:

$1.$ Prepare a schedule of expected cash collections for July. August, and September. Also, compute total cash collections for the quarter ended September $30.$

$2-$a$.$ Prepare a merchandise purchases budget for July. August, and September. Also, compute total merchandise purchases for the quarter ended September $30.$

$2-$b$.$ Prepare a schedule of expected cash disbursements for merchandise purchases for July. August, and September. Also, compute total cash disbursements for merchandise purchases for the quarter ended September $30.$

$3.$ Prepare an income statement for the quarter ended September $30.$

$4.$ Prepare a balance sheet as of September $30.$