Garden Sales, Incorporated, sells garden supplies. Management is planning its cash needs for the second quarter. The company usually has to borrow money during this quarter to support peak sales of lawn care equipment, which occur during May. The following information has been assembled to assist in preparing a cash budget for the quarter: a. Budgeted monthly absorption costing income statements for April-July are: b. Sales are 20% for cash and 80% on account. c. Sales on account are collected over a three-month period with 10% collected in the month of sale; 70% collected in the first month following the month of sale; and the remaining 20% collected in the second month following the month of sale. February's sales totaled $200,000, and March's sales totaled $300,000. d. Inventory purchases are paid for within 15 days. Therefore, 50% of a month's inventory purchases are paid for in the month of purchase. The remaining 50% is paid in the following month. Accounts payable at March 31 for inventory purchases during March total $126.000. 2. Each month's ending inventory must equal 20% of the cost of the merchandise to be sold in the following month. The merchandise inventory at March 31 is $84,000. t. Dividends of $49,000 will be declared and paid in April. 9. Land costing $16,000 will be purchased for cash in May. h. The cash belance at March 3115.$52,000; the company must maintain a cash balance of at least $40,000 at the end of each month. 1. The company has an agreement with a local bank that allows the company to borrow in increments of $1,000 at the beginning of Prepare the following for merchandise inventory, a schedule of expected cash disbursements April, May, and June, and for the quarter in total. Prepare a cash budget for April, May, and June as well as in total for the quarter. Note: Cash deficiency, repayments and interest should be indicated by a minus sign. u. Inventory purchases and March's sales totaled $300 collected in the sollected in the month of sale; 70% collected in the first m 9. Land costing $16,000 will be purchased for cash in May. 1. The company has an agreement with 350 ; the company must maintain a cash month, assume that interest end of the compounded. The cono. The interest rampany to borrow of at least $40,000 at the end of each month. whe would, as far it is able, repay the per month and for simplicity we winning of b. A scheduldise purchases budget for inventory: 3. Prepare a cash budigected cash disbursements Aay, and June