Hot Dog Express sells and installs hot dog carts. Managers need to prepare an inventory purchases budget for the first quarter of 2023. The company's sales budget for the first quarter is provided below:

January February March

Budgeted Sales $800,000 $784,000 $720,000 Based on past experience the company expects the cost of goods sold to equal 70% of sales. Furthermore, the ending inventory balance each month should be $32,000 plus 8% of the current period's cost of goods sold. The inventory balance on December 31, 2022 was $112,000. The company makes all purchases on account and pays 80% of accounts payable in the month of purchase and the remaining 20% in the next month. Accounts payable stood at $164,000 at December 31, 2022. Required: 1) Prepare an inventory purchases budget for January, February, and March of 2023. 2) Determine the amount of ending inventory and the accounts payable balance that will appear on the March 31, 2023 pro forma balance sheet. 3) Prepare a schedule of cash payments for inventory for January, February, and March, 2023.