Garden Sales, Inc. December 31, 2017 Cash $ 58,000.00 Account Payable $ 26,707.50 Accounts Receivable $ 162,000.00 Working Capital Line S Inventory S 89,025.00 Accrued Interest Payable 5 Prepaid Rent $ 12,000.00 Note Payable $ 50,000.00 Prop, Plant & Equip 900,000.00 Common Stock 200,000.00 Accum Depr Net PP&E S (100,000.00) 800,000.00 Retained Earnings S 844,317.50 Total Assets $ 1,121,025.00 1,121,025.00 November 2017 and December 2017 sales were $120,000, each month Sales for the following three months will decrease by $1,300 each month, beginning January through April. Cost of Sales represents 75% of sales, each month. . . . Cash Operating Expenses are 15% of sales, exclusive of Depreciation expense Depreciation Expense is $3,000, per month and prepaid rent is amortized at $1,000 per month Of the month's sales, 10% is collected as cash with the remaining placed on customer's account. Customer's accounts are usually paid off over a 2 month period (50% each month) beginning the month following the sale The CFO just informed you that one customer has filed bankruptcy therefore, $2,000 from Nov A/R Sales will be written off in Jan to Bad Debt Exp. To maintain sufficient inventory, the company purchases 100% of the next month's cost of sales. They pay for 70%, in cash, in the month they purchase and pay the remaining 30% in the following month. In March, the company is planning on replacing an outdated machine. The new machine will cost $30,000. The old machine originally cost $21,000 with a Net Book Value of 7,000 and will be sold for $5,000 . The Company does not pay or accrue for taxes until the end of December. . The Company plans to pay a cash dividend of $3,000 at the end of March. . . . Assume all operating expenses incurred during the month are paid, in cash, during the same month incurred The Note Payable requires a principal payment of $6,000, plus interest of $250, at the end of March. For this note, no interest is Accrued/Expensed until interest is paid The minimum cash month end balance required according to the bank agreement is $75,000 for any given month beginning Jan 30, 2018. A working capital line of credit is available, up to $25,000, and if needed, money is taken out at the beginning of the month. Interest is % % per month. Interest is paid on the working capital line when principal payments are paid on the debt; at the end of any given month. Interest is accrued on the working capital line effective the beginning of the month when money is received. 1. Prepare a detailed Cash Budget/Forecast for each month of Jan, Feb and March, 2018 2. Prepare an Income Statement for each period Jan-Mar 2018 (in good form) 3. Prepare a Balance Sheet as of March 31, 2018 (in good form) 4. Although you may use Excel, this assignment must be turned in as a HAND-WRITTEN document.