Edmonds Company, a sports specialty store, prepares its master budget on a quarterly basis. The following data have been assembled to assist in preparing the master budget for the first quarter:

Edmonds Company Balance Sheet December 31, 2016
Cash	$48,000
Accounts receivable	$84,000
Inventory	$80,000
Buildings and equipment (net)	$490,000	$702,000
Accounts payable	$90,000
Common stock	$500,000
Retained earnings	$112,000	$702,000

Information from marketing regarding sales:

Actual Sales for December were $280,000. Sales Projections for January through April are:

January: $400,000

February: $500,000

March: $300,000

April: $200,000

Sales are 70% for cash and 30% on credit. All payments on credit sales are collected in the month following sale. The accounts receivable at December 31 are a result of December credit sales. The companys gross margin is 50% of sales. (In other words, cost of goods sold is 50% of sales.) Monthly expenses are budgeted as follows:

salaries and wages, $27,000 per month

advertising, $70,000 per month

shipping, 5% of sales

other expenses, 3% of sales

Depreciation, including depreciation on new assets acquired during the quarter, will be $42,000 for the quarter. Each months ending inventory should equal 40% of the following months cost of goods sold. The December 31 ending inventory can be found in the financial statement information above. One-half of a months inventory purchases is paid for in the month of purchase; the other half is paid the following month. The December purchases are the amount of Accounts Payable shown in the financial statement information above.

During February, the company will purchase a new t-shirt making machine for $150,000 cash. During March, other equipment will be purchased for cash at a cost of $90,000. During January, the company will declare and pay $55,000 in cash dividends. Management MUST maintain a minimum cash balance of $30,000. The company has an agreement with a local bank that allows the company to borrow in increments of $1,000 at the beginning of each month. The interest rate on these loans is 1% per month and for simplicity we will assume that interest is not compounded. The company - if it is able will repay loans in total.

Prepare the following in good form (meaning clearly labeled) for the first quarter (January, February and March) using Excel.

Schedule of Cash Collections (5 points)

A Schedule of Merchandise Purchases (also called Merchandise Purchase Budget) (10 points)

A Schedule of Cash Disbursements for Inventory Purchases (10 points)

A Schedule of Cash Disbursements for Expenses (10 points)

Cash Budget (10 points)

Complete table below (5 points)

Amount that must be borrowed Cash balance at March 31 Loan balance at March 31 (no need to compute interest) When