Exercise 2. (15 Points).

Use the following information to prepare a budgeted balance sheet for Grover Company for the month of June.

a. The budgeted net income for the month of June is $236,000.

b. The beginning cash balance is $62,000; total budgeted cash receipts are $1,660,000; total budgeted cash payments are $1,580,000.

c. Budgeted sales for June are $1,700,000. Collections are 40% in the month of sale and 60% in the month following.

d. The projected inventory balance is 10% of the following month's sales. Sales for July are projected to be $1,750,000.

e. Budgeted purchases for June are $900,000 to be paid 80% in the month of purchase and 20% in the month following.

f. The equipment account balance is $1,400,000 on May 31. No equipment purchases or disposals will be made during June. On May 31, the accumulated depreciation is $276,000. Depreciation expense for June is estimated to be $24,000.

g. An outstanding loan balance of $800,000 is expected at the end of June.

h. Accrued income taxes payable for June 30 are expected to be $71,000. Salaries payable for June 30 are expected to be $50,000.

i. The only other balance sheet accounts are: Common Stock, with a balance of $800,000 on May 31, and Retained Earnings with a balance of $300,000 on May 31. No additional common stock will be issued and no dividends will be paid during June.