Case Study 2 - Lily Wholesale Company (Cash budget, BE point) On December 1, 2018, the Lily Wholesale Company, a wholly owned subsidiary of Matheson Electronics, is attempting to project cash receipts and disbursements through January 31, 2019. On this latter date, a note will be payable in the amount of $107,000. This amount was borrowed in September to carry the company through the seasonal peak in November and December. Selected general ledger balances on December 1 are: Cash $ 30,000 Inventory 111,800 Accounts payable $139,000 Sales terms call for a 3% discount if payment is made within the first 10 days of the month after sale. Experience has shown that 50% of the billings will be collected within the discount period, 30% of the sales collected in the month following sale, and 15% in the second month following sale. The remaining 5% will be uncollectible. There are no cash sales. The average selling price of the company's products is $170 per unit. Actual and projected sales are: $ 287,000 629,000 October (actual) November (actual) December (estimated) January (estimated) February (estimated) Total estimated for year ending June 30, 2018 561,000 612,000 510,000 $3,218,750 All purchases are payable within 15 days. Approximately 60% of the purchases in a month are paid that month and the rest the following month. The average unit purchase cost is $130. Target ending inventories are 570 units plus 20% of the next month's unit sales. Total budgeted marketing, distribution, and customer-service costs for the year are $670,000. Of this amount, $155,000 are considered fixed (and include depreciation of $43,400). The remainder varies with sales. Both fixed and variable marketing, distribution, and customer-service costs are paid as incurred. Requirements: An evaluation of the estimated subsidiary's performance or position Dec 2018 to Jan 2019 A detailed Literature Review of the tools you have used such as capital investment techniques, breakeven analysis and budgets and their importance to the business case. Other issues for management to consider that you think are vital for them to survive and make a profit.