Dimsdale Sports, a merchandising company. reports the following balance sheet at December 31. $ 36,000 525,000 158,888 DIMSDALE SPORTS COMPANY Balance Sheet December 31 Assets cash Accounts receivable Inventory Equipment $ 548,800 Less: Accumulated depreciation 67.500 Total assets Liabilities and Equity Liabilities Accounts payable $360,089 Loan payable 15 000 Taxes payable (due March 15) 90,000 Equity common stock $ 472 50e Retained earnings 246.000 Total 11abilities and equity 472,500 $1,183,500 $ 465.000 718.580 $ 1.183.500 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 $55 per unit. The Inventory level of 5.000 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, 9,000 units; March, 11000 units, and April, 10,000 units. All sales are on credit. b. Cash receipts from sales are budgeted as follows: January, $221,250: February. $697.000; March, $489.500. c. Cash payments for merchandise purchases are budgeted as follows: January, $80,000: February, $302.800: March. $147.600. d. Sales commissions equal to 20% of sales dollars are pald each month. Sa les salaries (excluding commissions) are $5.000 per month. e. General and administrative salarles are $12000 per month. Malntenance expense equals $2,000 per month and is pald In cash. f. New equipment purchases are budgeted as follows: January, $36.000; February. $96.000: and March. $28.800. Budgeted depreciation expense is January. $6.000: February. $7,000; and March, $7.300. g. The company budgets a land purchase at the end of March at a cost of $150.000, 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 19 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 $25.000 at the end of each month. 1. The income tax rate for the company is 40%. Income taxes on the first quarter's Income will not be paid until April 15. 1. Sales budgets. 2. Merchandise purchases budgets. 3. Selling expense budgets. 4. General and administrative expense budgets. Hint: Depreclatlon Is Included in the general and administrative budget for merchandisers. 5. Capital expenditures budgets. 6. Cash budgets. 7- Budgeted Income statement for entire quarter (not monthly) ended March 31. 8. Budgeted balance sheet as of March 31. Complete this question by entering your answers in the tabs below. Required 3 Required a Required 5 Required 6 Required 7 Required Capital expenditures budgets. DIMSDALE SPORTS Capital Expenditures Budget January February March Equipment purchases Land purchase Total capital expenditures Required 4 Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required a Required 5 Required & Required 7 Required 8 Cash budgets. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign.) DIMSDALE SPORTS COMPANY Cash Budget January February March Beginning cash balance Add: Cash receipts from sales Total cash available Less: Cash payments for: 0 0 Total cashments Preliminary cash balance Endingan balance Loan balance January February March Loan balance - Beginning of month Additional loan (loan repayment) Loan Dalance - End of month Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Required 5 Required 6 Reg Budgeted income statement for entire quarter (not monthly) ended March 31, DIMSDALE SPORTS COMPANY Budgeted Income Statement For Three Months Ended March 31 Sales Cost of goods sold Gross profit Selling, general and administrative expenses Sales commissions expense Sales salaries e pense General administrative salaries expense Maintenance expense Depreciation expense Loan interest expense 0 Tota operating expenses income before income taxes 0 Income taxes expense Net income Required 1 Required ? Required 3 Required a Required 5 Required 6 Required 7 Required 8 Budgeted balance sheet as of March 31. DIMSDALE SPORTS COMPANY Budgeted Balance Sheet March 31 Assets Casa Accounts receivable Inventory Equipment Less Accumulated depreciation 10 Galea Liabilities and Equity Pergunts payable 0 Common stock Betained earnings 10 Total Liabilities and Equity