Copy the master budget you prepared in question 1 and paste into a new sheet in the same Excel file.

Buyers at Jung So Min have come forward with new information from the main supplier of inventory. They are willing to hold the purchase price of the inventory for the first two quarters of 2021, but will be raising the purchase price of the inventory from $36 to $41 in the third quarter.

Required: 3 a) What impact will this have on the profit for 2021 and the ability to repay the line of credit or incur additional borrowings, if the selling price charged by Jung So Min does not change? 5 b) Do you recommend any change in the selling price charged by Jung So Min, in response to the change in its cost of inventory? Explain your plan (timing of increase, etc) and reasoning in full.

TIL 200 dowed 1 TTT TTT WE 2016 3 18 WE SIS INI Secondary COCO CS SH DI 01 RIE STI TUT MM SH Band TE TTT Sales Budget Quarter 1 6200 $50 $310,000 Particulars Expected Sales units Selling perice per Unit Projected Sales Value Quarter 2 6944 Quarter 3 7777 550 S388,850 Quarter 4 8711 550 Total 29632 550 $1,481,600.00 550 $347,200 $435,550 Particulars Total Inventory Purchases Budget Quarter 1 Quarter 2 $6,200 $6.944 $1,528 51,711,00 Quarter 3 57.777 Expected sales unit Add Ending Inventory Quarter 4 58 710.55 52,146.28 529 632 S2 146.00 $1.916 32 ANA Particulars Expected sales unit Add Ending Inventory Less: Beginning inventory Production budget Purchase cost per unit Inventory Purchase cost Budget Inventory Purchases Budget Quarter 1 Quarter 2 56,200 $6.944 $1,528 51.711.00 $1,200 $1,528 56,528 57,127 536 $36 234996 48 256572 0576 Quarter 3 Quarter 4 $7.777 58,710 55 51.916.32 52,146 28 $1.711 $1.916 S7 983 58 941 $36 287373.6645321870 0244 Total 529.632 $214601 $1,200 530 578 36 $36 11008026 Total Particulars Total sale value Credit sale @70% Less: Uncollectables@5% collectable credit sales Schedule for expected cash collection Quarter 1 Quarter 2 310000 347200 217000 243040 10850 12152 206150 230888 Quarter 3 388864 272204.8 Quarter 4 435527.68 304869 38 14815916 10371141 51855 985259 1 13610 258594.8 15243 289626.38 93000 104160 116659.2 130658.3 180000 444477.50 180000 206150 206150 Cash sales@30% Collected in Quarter 1 Collected in Quarter 2 Collected in Quarter 3 Collected in Quarter 4 Total collections 230888 258594.56 389252 86 230888 2585945 13201100 273000 310310 3475472 93000 104160 1166592 1306533 444477 50- 180000 180000 206150 Cash sales @30% Collected in Quarter 1 Collected in Quarter 2 Collected in Quarter 3 Collected in Quarter 4 Total collections 230888 206150 230888 258594.5 1320110.06 258594 56 389252.86 273000 310310 3475472 321858 1100812 234997 256584 Schedule of expected cash disbursement for inventory purchases Inventory purchase cost budget 234996 256584 287374 Paid for Quarter 1 purchases 164498 70499 Paid for Quarter 2 purchases 179609 76975 Paid for Quarter 3 purchases 201162 Paid for Quarter 4 purchases Paid for opening payables 50000 Total disburdement for inventory 214498 250108 278137 86212 225301 287374 225301 50000 1054256 311513 TIL 200 dowed 1 TTT TTT WE 2016 3 18 WE SIS INI Secondary COCO CS SH DI 01 RIE STI TUT MM SH Band TE TTT Sales Budget Quarter 1 6200 $50 $310,000 Particulars Expected Sales units Selling perice per Unit Projected Sales Value Quarter 2 6944 Quarter 3 7777 550 S388,850 Quarter 4 8711 550 Total 29632 550 $1,481,600.00 550 $347,200 $435,550 Particulars Total Inventory Purchases Budget Quarter 1 Quarter 2 $6,200 $6.944 $1,528 51,711,00 Quarter 3 57.777 Expected sales unit Add Ending Inventory Quarter 4 58 710.55 52,146.28 529 632 S2 146.00 $1.916 32 ANA Particulars Expected sales unit Add Ending Inventory Less: Beginning inventory Production budget Purchase cost per unit Inventory Purchase cost Budget Inventory Purchases Budget Quarter 1 Quarter 2 56,200 $6.944 $1,528 51.711.00 $1,200 $1,528 56,528 57,127 536 $36 234996 48 256572 0576 Quarter 3 Quarter 4 $7.777 58,710 55 51.916.32 52,146 28 $1.711 $1.916 S7 983 58 941 $36 287373.6645321870 0244 Total 529.632 $214601 $1,200 530 578 36 $36 11008026 Total Particulars Total sale value Credit sale @70% Less: Uncollectables@5% collectable credit sales Schedule for expected cash collection Quarter 1 Quarter 2 310000 347200 217000 243040 10850 12152 206150 230888 Quarter 3 388864 272204.8 Quarter 4 435527.68 304869 38 14815916 10371141 51855 985259 1 13610 258594.8 15243 289626.38 93000 104160 116659.2 130658.3 180000 444477.50 180000 206150 206150 Cash sales@30% Collected in Quarter 1 Collected in Quarter 2 Collected in Quarter 3 Collected in Quarter 4 Total collections 230888 258594.56 389252 86 230888 2585945 13201100 273000 310310 3475472 93000 104160 1166592 1306533 444477 50- 180000 180000 206150 Cash sales @30% Collected in Quarter 1 Collected in Quarter 2 Collected in Quarter 3 Collected in Quarter 4 Total collections 230888 206150 230888 258594.5 1320110.06 258594 56 389252.86 273000 310310 3475472 321858 1100812 234997 256584 Schedule of expected cash disbursement for inventory purchases Inventory purchase cost budget 234996 256584 287374 Paid for Quarter 1 purchases 164498 70499 Paid for Quarter 2 purchases 179609 76975 Paid for Quarter 3 purchases 201162 Paid for Quarter 4 purchases Paid for opening payables 50000 Total disburdement for inventory 214498 250108 278137 86212 225301 287374 225301 50000 1054256 311513