Corning Incorporated sells its product for $24 per unit. Its actual and projected sales follow:

	Units	Dollars
January (actual)	18,500	$444,000
February (actual)	23,000	552,000
March (budgeted)	19,800	475,200
April (budgeted)	18,950	454,800
May (budgeted)	22,000	528,000

Here is added information about Cornings operations:

All sales are on credit. Recent experience show that 35% of sales are collected in the month of the sale, 45% in the month following the sale, 17% in the second month after the sale, and 3% prove to be uncollectible. The products purchase price is $15 per unit. All payments are payable within 21 days. Thus 30% of purchases in any given month are paid for in that month, with the remaining 70% paid for in the following month. The company has a policy to maintain an ending inventory of 20% of the next months projected sales plus a safety stock of 100 units. The January 31 and February 28 actual inventory levels are consistent with this policy. Selling and administrative expenses for the year are $2,456,000 and are paid evenly throughout the year in cash. The companys minimum cash balance at month-end is $50,000. This minimum is maintained, if necessary, by borrowing cash from the bank. If the balance exceeds $50,000, the company repays as much of the loan balance as it can without going below the minimum. This loan carries an annual interest rate of 6% (0.5% per month). At February 28, the loan balance is $14,000, and the companys cash balance is $50,000.

Required:

Part1. Prepare a table that shows cash collections from accounts receivable for March and April

Part2. Prepare a table that shows the computation of ending inventory in units for January, February, March, and April.

Part3. Prepare the merchandise purchases budget for February, March, and April.

Part4. Prepare a table showing the computation of cash payments on merchandise purchases for March and April.

Part5. Prepare a cash budget for March and April, including any loan activity and interest expense. Compute the loan balance at the end of each month.