Following are the budgeted income statements for the second quarter of 2019 for SeaTech Inc.: Sales April $238,000 163,200 May $289,000 June $323,000 Cost of goods sold* Gross profit Operating expensest Operating income $ 74,800 37,400 $ 37,400 193,800 $ 95,200 42,500 214,200 $ 52,700 $108,800 45,900 $ 62,900 Includes all product costs (i.e., direct materials, direct labor, and manufacturing overhead). Includes all period costs (i.e., selling, general, and administrative expenses). The company expects about 30% of sales to be cash transactions. Of sales on account, 60% are expected to be collected in the first month after the sale is made, and 40% are expected to be collected in the second month after sale. Depreciation, insurance, and property taxes represent $20,400 of the estimated monthly cost of goods sold and $13,600 of the estimated monthly operating expenses. The annual insurance premium is paid in January, and the annual property taxes are paid in August. Of the remainder of the cost of goods sold and operating expenses, 80% are expected to be paid in the month in which they are incurred, and the balance is expected to be paid in the following month. Current assets as of April 1, 2019, consist of cash of $23,800 and accounts receivable of $254,660 ($178,262 from March credit sales and $76,398 from February credit sales). Current liabilities as of April 1 consist of $30,600 of accounts payable for product costs incurred in March; $7,820 of accrued liabilities for operating expenses incurred in March; and a $68,000, 14%, 120-day note payable that is due on April 17, 2019. An estimated income tax payment of $68,000 will be made in May. The regular quarterly dividend of $27,200 is expected to be declared in May and paid in June. Capital expenditures amounting to $29,240 will be made in April.