Deacon Company is a merchandising company that is preparing a budget for the second quarter of the calendar year. The following information is available. DEACON COMPANY Balance Sheet March 31 Assets Cash Accounts receivable Inventory Plant and equipment, net of depreciation Total assets Liabilities and Shareholders' Equity Accounts payable Common shares Retained earnings Total liabilities and shareholders' equity $ 65,000 39,000 49,000 98,000 $251,000 $ 47,000 63,000 141,000 $251,000 Budgeted Income Statements Sales April $107,000 May June $120,000 $138,000 Cost of goods sold 64,200 72,000 82,800 Gross margin 42,800 48,000 55,200 Selling and administrative expenses 14,000 10,000 15,000 Operating income $ 28,800 $ 38,000 $ 40,200 Budgeting Assumptions: a. Sixty percent of sales are cash sales and 40 percent of sales are credit sales. Twenty percent of all credit sales are collected in the month of sale and the remaining 80 percent are collected in the month subsequent to the sale. b. Budgeted sales for July are $143,000. c. 10% of merchandise inventory purchases are paid in cash at the time of the purchase. The remaining 90% of purchases are credit purchases. All purchases on credit are paid in the month subsequent to the purchase. d. Each month's ending merchandise inventory should equal $10,000 plus 50% of the next month's cost of goods sold. e. Depreciation expense is $1,500 per month. All other selling and administrative expenses are paid in full in the month the expense is incurred. Required: 1. Calculate the expected cash collections for April, May, and June. 2. Calculate the budgeted merchandise purchases for April, May, and June. 3. Calculate the expected cash disbursements for merchandise purchases for April, May, and June. 4. Prepare a budgeted balance sheet at June 30. (Hint: You need to calculate the cash paid for selling and administrative expenses during April, May, and June to determine the cash balance in your June 30 balance sheet.) Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Prepare a budgeted balance sheet at June 30. (Hint: You need to calculate the cash paid for selling and administrative expenses during April, May, and June to determine the cash balance in your June 30 balance sheet.) Deacon Company Balance Sheet Cash Accounts receivable Inventory June 30 Assets Plant and equipment, net of depreciation $ 191,810 X 44,160 52,900 93,500 Total assets $ 382,370 Liabilities and Shareholders' Equity Accounts payable $ 75,870 Common share 63,000 Retained earnings 243,500 X Total liabilities and stockholders' equity $ 382,370