Colorado Inc., a merchandising firm, has budgeted its activity for July according to the following information: 1. Sales at $650,000, all for cash. 11. Merchandise inventory on June 30th was $300,000. III. Budgeted depreciation for July is $35,000. IV. The cash balance at July 1 was $25,000. V. Selling and administrative expenses are budgeted at $60,000 for July and are paid in cash. VI. The planned merchandise inventory on July 31 is $270,000. VII. The invoice cost for merchandise purchases represents 75% of the sales price. All purchases are paid for in cash. 1. What are the budgeted cash receipts for July? a. $137,500. b. $412,500. c. $650,000. d. $585,000. 2. What are the budgeted cash disbursements for July? a. $382,500. b. $517,500. c. $472,500. d. $477,500. 3. What is the budgeted net income for July? a. $42,500. b. $67,500. c. $107,500. d. $137,500.