Explanation and answers. Please highlight answers.

Case 10.59 Sports Fanatic Company is a retail sporting goods store that uses accrual accounting for its records. Information on Sports Fanatic's operations is as follows: 1. The store has budgeted sales at $220,000 for January and $200,000 for February. 2. It expects collections to be 60% in the month of sale and 38% in the month following the sale. It expects 2% of sales to be uncollectible. 3. Gross margin is 25% of sales. 4. purchases it. It purchases a total of 80% of the merchandise for resale in the month before the month of sale and 20% in the month of sale. It makes payments for merchandise in the month after it 5. Other expected monthly expenses to be paid in cash amount to $22,600. 6. Annual depreciation is $216,000. 7. Sports Fanatic's balance sheet at the close of business on December 31 follows.SPORTS FANATIC COMPANY Cash Budget For the Month of January Beginning Cash Balance 22000 Add + : Cash Receipts Collections from January 132000 Accounts Receivable-from December * 76000 Total Cash Receipts 230000 T Total Disbursements