Dimsdale Sports, a merchandising company, reports the following balance sheet at December 31 DDSDALE SPORTS COMPANY Assets Balance Sheet December 31 Cash $20,500 Inventory Equipment Accounts receivable Less: Accumulated depreciation 520,000 165,000 $ 636,000 79,500 554,500 Total assets $1,262,000 Liabilities and Equity Liabilities Accounts payable $350,000 Loan payable Taxes payable (due March 15) 13,000 91,000 454,000 Equity Common stock Retained earnings $471,000 337,000 Total liabilities and equity 800,000 $1,262,000 To prepare a master budget for January, February, and March, use the following information a. The company's single product is purchased for $30 per unit and resold for $60 per unit. The inventory level of 5,500 units on December 31 is more than management's desired level, which is 20% of the next month's budgeted sales units. Budgeted sales are January, 7,000 units: February, 8,500 units; March, 11,000 units; and April, 10,500 units. All sales are on credit b. Cash receipts from sales are budgeted as follows: January, $272,000, February, $745,490, March, $540.855. c. Cash payments for merchandise purchases are budgeted as follows: January, $60,000. February, $309,200, March, $130,800 d. Sales commissions equal to 20% of sales dollars are paid each month. Sales salaries (excluding commissions) are $6,000 per month e. General and administrative salaries are $13,000 per month. Maintenance expense equals $1.900 per month and is paid in cash f. New equipment purchases are budgeted as follows: January, $36,000, February. $91,200, and March, $24,000. Budgeted depreciation expense is January. $7,000, February. $7,950, and March, $8.200 < Previ 2 of 2 Next >