Following is selected information relating to the operations of Shilow Company, a wholesale distributor: Current assets as of March 31: Cash Accounts receivable Inventory Plant and equipment, net Accounts payable Capital shares Retained earnings $ 11,000 24,000 43,200 133,000 27,200 170,000 14,000 a. Gross margin is 25% of sales. b. Actual and budgeted sales data are as follows: March (actual) April May June July $ 60,000 72,000 84,000 102,000 58,000 C. Sales are 60% for cash and 40% on credit. Credit sales are collected in the month following sale. The accounts receivable at March 31 are a result of March credit sales. d. At the end of each month, inventory is to be on hand equal to 80% of the following month's sales needs, stated at cost. e. One-half of a month's inventory purchases are paid for in the month of purchase; the other half are paid for in the following month. The accounts payable at March 31 are a result of March purchases of inventory. f. Monthly expenses are as follows: salaries and wages, 12% of sales; rent, $3,500 per month; other expenses (excluding depreciation), 6% of sales. Assume that these expenses are paid monthly. Depreciation is $1,100 per month (includes depreciation on new assets). g. Equipment costing $1,700 will be purchased for cash in April. h. The company must maintain a minimum cash balance of $6,000. An open line of credit is available at a local bank. All borrowing is done at the beginning of a month, and all repayments are made at the end of a month; borrowing must be in multiples of $1,000. 1. Prepare a schedule of expected cash collections. SHILOW COMPANY Schedule of Expected Cash Collections April May June Quarter Cash sales Credit sales Total cash collections 2. Prepare a schedule of inventory purchases and a schedule of expected cash disbursements for purchases. SHILOW COMPANY Schedule of Inventory Purchases April May June Quarter Total needs SHILOW COMPANY Quarter Schedule of Expected Cash Disbursements for Purchases April May June March purchases April purchases May purchases June purchases Total cash disbursements