Case 8-33 (Algo) Master Budget with Supporting Schedules [LO8-2, LO8-4, LO8-8, LO8-9, LO8-10] You hove just been hired as a new management trainee by Earnings Unimited, a distribitor of earings to various retal outlets located in shopping mails across the country, In the post, the company has done very little in the way of budgeting and at certain times of the the upcoming second quartec. To this end, you have worked wit occounting and other ar eas to gather the information assenbied belowi The company sells mary styles of earnings, but all are sold for the came price-si6 per par; Actual sales of earnngs for the fast three months and budgeted tales for the next six months follow in pairs of earrings! The concentration of sales before and during May is due to Mother's Day, Sufficient inventory should be on hand at the crid of each month to supply 40% of the earrings sold in the following month. pod for in the following month. Ait soles are on credit Only 20% of a month's soles are collected in the month of sale, An oddinonol ineotionite. Nontly operating expences for the company are given below: Ineurance is paid on an annsol basis, in Nowember of each year will be for cash. The company declares dividends of $24000 each cuartec poyoble in the first month of the following cuanter. The companys butance sheet as of March 31 is given below: The company maintains a minimum cash balance of $62,000. All borrowing is done ot the beginnting of a month, any repayments are made at the end of a month The compary has on agreement with a bank that allows the company to borrow in ficrernents of \$1,000 ot the beginntng of each month. The interest rate on these loans is 1% per month and for simpilicity we wil aspume that interest is not compounded. At the end of the quarter, the company would pay the bank aff of the accumutated interest on the loan and as much of the loan as possible gin increments of $1000, whlle still retaining at least $62.000 in cash. Requlred: Prepare a master budget for the three-month pertod ending June 30. Inciude the followng detalled schedules: 1. A sales budget, by month and in total b. A schedule of expected cash collections, by month and in total. C A merchandise purchases budget in units and in dollars, Show the budget by month and in total d. A schedule of expected cash disbursernents for merchandse purchases, by month and in total 2. A cash budget. Show the budget by month and in totat: Deternine any borrowing that would be needed to maintain the minlmum cash balance of $62.000. 3. A budgeted income statement for the three montt pertod ending June 30 Use the contribution approtech A. A budgeted balance sheet os of June 30