Book rint erences Mc Graw Hill Hillyard Company, an office supplies specialty store, prepares its master budget on a quarterly basis. The following data F assembled to assist in preparation of the master budget for the first quarter: a. As of December 31 (the end of the prior quarter), the company's general ledger showed the following account balances Cash Accounts receivable Inventory Buildings and equipment (net) Accounts payable Capital shares Retained earnings December (actual) January February March April Debits $ 48,000 224,000 60,000 379,000 $280,000 400,000 600,000 320,000 210,000 Credits b. Actual sales for December and budgeted sales for the next four months are as follows: $ 95,000 510,000 106,000 $711,000 $711,000 c. Sales are 20% for cash and 80% on credit. All payments on credit sales are collected in the month following sale. The account receivable at December 31 are a result of December credit sales. d. The company's gross margin is 40% of sales. e. Monthly expenses are budgeted as follows: salaries and wages, $25,000 per month; advertising, $70,000 per month, shipping of sales; depreciation, $12.000 per month; other expenses, 3% of sales. f. At the end of each month. inventory is to be on hand equal to 25% of the following month's sales needs. stated at cost. Pisey 1 of 6 MOD www www Next