Gatden Sales, tricorporated, selis garden suppties Management is planning its cash needs for the second quarter. The company usually has to bortow 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 Aprit-July are: b. Sales are 20% for cash and 80% on account. c. Sales on account are collected over a three-month period with 10s collected in the month of sale; 70% collected in the first month foliowing the month of sale; and the remaining 209 collected in the second month following the month of sale. February's sales totaled $230,000, and March's sates totaled $255,000 d. Inventory purchases are pald for within 15 days. Therefore, 509 is 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 $114,800 e. Each month's ending inventory must equal 205 of the cost of the merchandise to be sold in the following month. The merchandise inventory at March 31 is $86,800. f. Dividends of $31,000 will be declared and paid in Apnt. 9 Land costing $39,000 will be purchased for cash in May. h. The cash balance at March 315$53,000, 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 aliows the company to borrow in increments of $1,000 at the beginning of each month, up to a total loan balance of $200.000. The interest rate on these loans is tis per month and for simplicity we wim assume that interest is not compounded The company would. as far as it is able, repay the loan plus accumulated interest at the end of the quarter Required: 1 Prepare a schedule of expected cash collections for Apni. May, and June, and for the quarter in total 2. Prepare the following for merchandise inventory: a. A merchandise purchases budget for Aprit, May, and June. b. A schiedule of expected cash disbursements for merchandise purchases for Apri, May, and June, and for the quarter in total 3. Prepare a cash budget for Aprit, May, and June as well as in total for the quartet