Carly's Critters Company operates a gift shop at the local zoo. The results of operations for the first

quarter of $2024$ are as follows:

Additional Fun & Exciting Information:

Asset accounts are cash, accounts receivable, inventory, and equipment $($net$).$ Accounts payable is

the only liability account. Owner's equity accounts are common stock and retained earnings.

Fifty$-$five percent of inventory purchases are paid in the quarter of purchase and $45$ percent are

paid in the following quarter. All other expenses, including taxes, are paid in the quarter incurred.

The cash balance at the end of quarter one is $$8,888.$

Sales and cost of goods sold are expected to dscrcase by $12$ percent in each of the next three

quarters of the year.

Selling & Administrative expenses are expected to increase by $$4,675$ due to increases in

advertising and salaries. All other expenses in this category are expected to remain constant.

The balance in accounts receivable at the end of quarter one relates to sales made during the first

quarter of $2024.$

Dividends of $$905$ are paid out during each quarter.

Inventory purchases in the first quarter of $2024$ are $$44,440.$

The balance in accounts payable at the end of quarter one relates to purchases made during the

first quarter of $2024.$

Selling & Administrative expense includes $$985$ of quarterly depreciation related to equipment.

The equipment had a book value of $$17,825$ at the end of quarter one.

Inventory at the end of the first quarter is $$64,670.$ The company plans on holding ending

inventory equal to $75$ percent of subsequent quarter cost of goods.

Sixty$-$five percent of sales are collected in the quarter of sale and $35$ percent are collected in the

quarter following the sale.

Common stock at the end of quarter one is $$80,568$ and retained earnings is $$34,567.$

The tax rate is expected to remain at $32$ percent.

Required

A$.$ Prepare a budgeted income statement for the second quarter of $2024.$

B$.$ Prepare a cash receipts & disbursements budget for the second quarter of $2024.$

C$.$ Prepare a budgeted balance sheet as of the end of the second quarter of $2024.$

D$.$ The company is discussing the possibility of opening a new store at a new zoo right at the beginning

of the third quarter. This store would require cash payments of $$15,000.$ Assuming the company

wants a minimum cash balance of $$40,000$ at the beginning of the third quarter, can a new store be

opened without obtaining additional funds? How much will they have to borrow or have left over?