C. Sales are 40% for cash and 60% on credit, credit sales are collected in the month following sale. The accounts receivable at December 31 are the result of December credit sales D. Each month's ending inventory should equal 20% of the following month's budgeted cost of goods sold E. One quarter of a month's inventory purchases is paid for in the month of purchase; the other three- quarters is paid for in the following month. The accounts payable at December 31 are the result of December purchases of inventory. F. Monthly expenses are as follows: Commissions, $12,000, rent ,$1,800, other expenses (excluding depreciation), 8% of sales. Assume that these expenses are paid monthly Depreciation is $2,400 for the quarter and includes depreciation on new assets acquired during the quarter G. Equipment will be acquired for cash: $3,000 in January and $8,000 in february h.Management would like to maintain a minimum cash balance of $5,000 at the end of each month. The company has an agreement with a local bank that allows the company to borrow in increments of $1,000 at the beginning of each month, up to a total loan balance of $50,000 The interest rate on these loans is 1% per month, and for simplicity, we will assume that interest is not compounded. The company would as far it is able, repay the loan plus accumulated interest at the end of the quarter 2. Complete the Following Merchandise Purchases Budget January February March Quarter Budgeted $49000 COGS Add desired 11,200 ending inventory Total Needs Less: Beginning 9,800 60,200 Inventory Required $50,400 Purchases $70,000 sales x 70%-$49,000 $80,000 x 70% x 20%= $11,200