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

Beech Corporation

Balance Sheet

June $30$

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

Estimated sales for July, August, September, and October will be $$360,000,$$$380,000,$$$370,000,$ and $$390,000,$ 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 $60\%$ 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 $$48,000.$ Each month $$7,000$ of this total amount is depreciation expense and the remaining $$41,000$ 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:

Prepare a schedule of expected cash collections for July, August, and September.

$2-$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, $\{$ugust$,$ and September.

Prepare an income statement that computes net operating income for the quarter ended Sentember $30.$

Prepare a balance sheet as of September $30.$