Dimsdale Sports, a merchandising company, reports the following balance sheet at December 31. DIMSDALE SPORTS COMPANY Balance Sheet Cash Assets Accounts receivable December 31 $ 22,000 520,000 Inventory Equipment Less: Accumulated depreciation Total assets Liabilities Accounts payable Loan payable 165,000 $ 636,000 79,500 556,500 $ 1,263,500 Liabilities and Equity $ 345,000 12,000 91,000 448,000 $ 475,000 340,500 Taxes payable (due March 15) Equity Common stock Retained earnings. Total liabilities and equity 815,500 $ 1,263,500 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 $58 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, 9,250 units; March, 10,500 units; and April, 10,000 units. All sales are on credit. b. Cash receipts from sales are budgeted as follows: January, $241,800; February, $739,996; March, $524,451. c. Cash payments for merchandise purchases are budgeted as follows: January, $70,000; February, $295,100; March, $137,400. 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 $11,000 per month. Maintenance expense equals $2,000 per month and is paid in cash. f. New equipment purchases are budgeted as follows: January, $40,800; February, $96,000; and March, $24,000. Budgeted depreciation expense is January, $ 7,050; February, $8,050; and March, $8,300. g. The company budgets a land purchase at the end of March at a cost of $160,000, which will be paid with cash on the last day of the month. h. The company has an agreement with its bank to obtain additional loans as needed. The interest rate is 1% per month and interest is paid at each month-end based on the beginning-month balance. Partial or full payments on these loans are made on the last day of the month. The company maintains a minimum ending cash balance of $22,000 at the end of each month. i. The income tax rate for the company is 37%. Income taxes on the first quarter's income will not be paid until April 15. General and administrative expense budgets. Hint: Depreciation is included in the general and administrative budget for merchandisers. DIMSDALE SPORTS General and Administrative Expense Budget February January Total general and administrative expenses March Total Capital expenditures budgets. Total capital expenditures DIMSDALE SPORTS Capital Expenditures Budget January February March Cash budgets. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign. Round your final answers to the nearest whole dollar.) DIMSDALE SPORTS COMPANY Beginning cash balance Total cash available Less: Cash payments for: Total cash payments Preliminary cash balance Ending cash balance Loan balance - Beginning of month Additional loan (loan repayment) Loan balance - End of month Cash Budget January February March 0 0 Loan balance January February March Budgeted income statement for the entire first quarter (not for each month). (Round your final answers to the nearest whole dollar.) DIMSDALE SPORTS COMPANY Budgeted Income Statement For Three Months Ended March 31 Selling, general and administrative expenses Total operating expenses 69 $ 0 0 Budgeted balance sheet as of March 31. (Round your final answers to the nearest whole dollar.) DIMSDALE SPORTS COMPANY Budgeted Balance Sheet March 31 Assets Total assets Liabilities Equity Total Liabilities and Equity Liabilities and Equity 0