I need help with requirement 3 & 4 via the attached document.

SPRING 2016 GROUP PROJECT DUE 04/08/2016 Norton Company sells software packages for $10 each. Actual and budgeted sales in units for nine months are as follows: January (actual) ........... February (actual) ......... March (actual) ............ April (budget) ............ May (budget) ............. 20,000 26,000 40,000 65,000 100,000 June (budget) ............. July (budget) .............. August (budget) .......... September (budget) ...... 50,000 30,000 28,000 25,000 The company should have sufficient inventory on hand at the end of each month to supply 40% of the software sold in the following month. Suppliers are paid $4 each for a software package. One half of a month's purchases are paid for in the month of purchase; the other half is paid for in the following month. All sales are on credit, with no discount, and payable within 15 days. The company has found, however, that only 20% of a month's sales are collected in the month of sale. An additional 70% is collected in the following month, and the remaining 10% is collected in the second month following sale. Monthly operating expenses for the company are given below: Variable: Sales commission................. 4% of sales Fixed: Advertising........................ $200,000 Rent................................. 18,000 Salaries............................. 106,000 Utilities............................. 7,000 Insurance........................... 3,000 Depreciation....................... 14,000 Insurance is paid on an annual basis, in November of each year. The company plans to purchase $16,000 in new equipment during May and $40,000 in new equipment during June; both purchases will be for cash. The company declares dividends of $15,000 each quarter, payable in the first month of the following quarter. A listing of the company's ledger accounts as of March 31 is given below: Assets Cash................................................... $74,000 Accounts Receivable ($26,000 February Sales; $320,000 March sales) ............................. 346,000 Inventory ............................................. 104,000 Prepaid Insurance ................................... 21,000 Property and equipment (net) ..................... 950,000 Total assets........................................... $1,495,000 Liabilities and Stockholders' Equity Accounts payable.................................... $100,000 Dividends payable................................... 15,000 Capital Stock......................................... 800,000 Retained earnings.................................... 580,000 Total liabilities and stockholders' equity......... $1,495,000 The company maintains a minimum cash balance of $50,000. All borrowing is done at the beginning of a month; any repayments are made at the end of a month. The company has an agreement with a bank that allows the company to borrow in increments of $1,000 at the beginning of each month. The interest rate on these loans is 1% per month and for simplicity we will assume that interest is not compounded. At the end of the quarter, the company would pay the bank all of the accumulated interest on the loan and as much of the loan as possible (in increments of $1,000), while still retaining at least $50,000 in cash. Required: 1. Prepare budgets for the three-month period ending June 30. Include the following detailed budgets: a. A sales budget, by month and in total. b. A schedule of expected cash collections from sales, by month and in total. c. A merchandise purchases budget in units and in dollars. Show the budget by month and in total. d. A schedule of expected cash disbursements for merchandise purchases, by month and in total. 2. A cash budget. Show the budget by month and in total. Determine any borrowings that would be needed to maintain the minimum cash balance of $50,000. 3. A budgeted income statement for the three-month period ending June 30. Use the contribution approach. 4. A budgeted balance sheet as of June 30