Check my v Garden Sales, Inc. sells garden supplies. Management is planning its cash needs for the second quarter. The following information has been assembled to assist in preparing a cash budget for the quarter. a. Budgeted monthly income statements for April to July are as follows: Cost April $500,000 348,000 152,000 May $740,000 516,000 224,000 $420,000 294,000 126,000 July $340,000 238,000 102,wed -59:41 Sales goods sold Gross margin Less: Operating expenses: Selling expense Administrative expense* Total operating expenses Net income bok 67,200 38,000 105, 200 $ 46,800 100,000 42,200 142,200 $ 81,800 51,600 34,800 86,400 39,600 42,800 32,400 75,200 $ 26,800 int ances *Includes $20,000 in depreciation each month. b. Sales are 20% for cash and 80% on account. c Sales on account are collected over a three-month period in the following ratio: 10% collected in the month of sale, 70% collected in the first month following the month of sale, and the remaining 20% collected in the second month following the month of sale. February's sales totalled $180,000, and March's sales totalled $260,000. d. Inventory purchases are paid for within 15 days. Therefore, 50% of a month's inventory purchases are paid for in the month of purchase. The remaining 50% are paid in the following month. Accounts payable at March 31 for inventory purchases during March total $103,200. e. At the end of each month, inventory must be on hand equal to 20% of the cost of the merchandise to be sold in the following month. The merchandise inventory at March 31 is $69,600. f. Dividends of $40,600 will be declared and paid in April. g. Equipment costing $13,800 will be purchased for cash in May. h. The cash balance at March 31 is $43,600; the company must maintain a cash balance of at least $31.000 at all times. L. The company can borrow from its bank, as needed to bolster the cash account. Borrowings and repayments must be in multiples of $500 Interest is due only when principal is rennid and is calculated on the amount of repayment for the duration of the time money Prev 6 of 8 !!! Next > 6 20 points 2. Prepare the following for merchandise inventory: X 02:59:06 a. An inventory purchases budget for each of the months April, May, and June. eBook GARDEN SALES, INC. Inventory Purchases Budget April Print May June References Total needs 6 20 points 02:58:51 b. A schedule of expected cash disbursements for inventory for each of the months April May, and June, and for the quarter in total. eBook Print Quarter References GARDEN SALES, INC. Schedule of Expected Cash Disbursements for Inventory April May June Accounts payable, March 31 April purchases May purchases June purchases Total cash disbursements S 05 0 $ 0 $ 0 3. Prepare a cash budget for the third quarter, by month as well as in total for the quarter. Show borrowings from the company's bank and repayments to the bank, as needed, to maintain the minimum cash balance. (Roundup "Borrowing" and "Repayments" answers to the nearest whole dollar amount. Any "Repayments" and "Interest" should be indicated by a minus sign.) M Check my v Garden Sales, Inc. sells garden supplies. Management is planning its cash needs for the second quarter. The following information has been assembled to assist in preparing a cash budget for the quarter. a. Budgeted monthly income statements for April to July are as follows: Cost April $500,000 348,000 152,000 May $740,000 516,000 224,000 $420,000 294,000 126,000 July $340,000 238,000 102,wed -59:41 Sales goods sold Gross margin Less: Operating expenses: Selling expense Administrative expense* Total operating expenses Net income bok 67,200 38,000 105, 200 $ 46,800 100,000 42,200 142,200 $ 81,800 51,600 34,800 86,400 39,600 42,800 32,400 75,200 $ 26,800 int ances *Includes $20,000 in depreciation each month. b. Sales are 20% for cash and 80% on account. c Sales on account are collected over a three-month period in the following ratio: 10% collected in the month of sale, 70% collected in the first month following the month of sale, and the remaining 20% collected in the second month following the month of sale. February's sales totalled $180,000, and March's sales totalled $260,000. d. Inventory purchases are paid for within 15 days. Therefore, 50% of a month's inventory purchases are paid for in the month of purchase. The remaining 50% are paid in the following month. Accounts payable at March 31 for inventory purchases during March total $103,200. e. At the end of each month, inventory must be on hand equal to 20% of the cost of the merchandise to be sold in the following month. The merchandise inventory at March 31 is $69,600. f. Dividends of $40,600 will be declared and paid in April. g. Equipment costing $13,800 will be purchased for cash in May. h. The cash balance at March 31 is $43,600; the company must maintain a cash balance of at least $31.000 at all times. L. The company can borrow from its bank, as needed to bolster the cash account. Borrowings and repayments must be in multiples of $500 Interest is due only when principal is rennid and is calculated on the amount of repayment for the duration of the time money Prev 6 of 8 !!! Next > 6 20 points 2. Prepare the following for merchandise inventory: X 02:59:06 a. An inventory purchases budget for each of the months April, May, and June. eBook GARDEN SALES, INC. Inventory Purchases Budget April Print May June References Total needs 6 20 points 02:58:51 b. A schedule of expected cash disbursements for inventory for each of the months April May, and June, and for the quarter in total. eBook Print Quarter References GARDEN SALES, INC. Schedule of Expected Cash Disbursements for Inventory April May June Accounts payable, March 31 April purchases May purchases June purchases Total cash disbursements S 05 0 $ 0 $ 0 3. Prepare a cash budget for the third quarter, by month as well as in total for the quarter. Show borrowings from the company's bank and repayments to the bank, as needed, to maintain the minimum cash balance. (Roundup "Borrowing" and "Repayments" answers to the nearest whole dollar amount. Any "Repayments" and "Interest" should be indicated by a minus sign.) M