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The following data relate to the operations of Picanuy Corporation, a wholesale distributor of consumer goods: Current assets as of December 31: Cash. Accounts receivable Inventory. Buildings and equipment, net. Accounts payable Capital stock Retained earnings $6,000 $36,000 $9,800 $110,885 $32,550 $100,000 $30,135 a. b. The gross margin is 30% of sales. (In other words, cost of goods sold is 70% of sales.) Actual and budgeted sales data are as follows: December (actual) January. February March April $60,000 $70,000 $80,000 $85,000 $55,000 c. Sales are 40% for cash and 60% on credit. Credit sales are collected in the month following sale. The accounts receivable at December 31 are the result of December credit sales. d. Each month's ending inventory should equal 20% of the following month's budgeted cost of goods sold. e. One-quarter of a month's inventory purchases is paid for in the month of purchase; the other three-quarters is paid for in the following month. The accounts payable at December 31 are the result of December purchases of inventory. f. Monthly expenses are as follows: commissions, $12,000; rent, $1,800; other expenses (exclud- ing depreciation), 8% of sales. Assume that these expenses are paid monthly. Depreciation is $2,400 for the quarter and includes depreciation on new assets acquired during the quarter. g. Equipment will be acquired for cash: $3,000 in January and $8,000 in February, h. Management would like to maintain a minimum cash balance of $5,000 at the end of each month. The company has an agreement with a local bank that allows the company to borrow in increments of $1,000 at the beginning of each month, up to a total loan balance of $50,000. The interest rate on these loans is 1% per month, and for simplicity, we will assume that inter- est is not compounded. The company would, as far as it is able, repay the loan plus accumu- lated interest at the end of the quarter. : Required: Using the data above: 1. Complete the following schedule: Schedule of Expected Cash Collections January February March Quarter Cash sales Credit sales. $28,000 36,000 $64,000 Total collections..... 2. Complete the following: March Quarter Merchandise Purchases Budget Januaryruary Budgeted cost of goods sold $49,000* Add desired ending inventory 11,2007 Total needs 60,200 Less beginning inventory 9,800 Required purchases $50,400 *$70,000. sales x 70% = $49,000. +$80,000 X 70% X 20%= $11,200 and Schedule of Expected Cash Disbursements-Merchandise Purchases January February March Quarter December purchases $32,550* $32,550 January purchases. 12,600 $37,800 50,400 February purchases March purchases Total disbursements $45,150 *Beginning balance of the accounts payable. 3. Complete the following schedule: Schedule of Expected Oash Disbursements --Selling and Administrative Expenses January February March Quarter Commissions : Rent Other expenses Total disbursements $12,000 1,800 5,600 $19,400 4. Complete the following cash budget: Cash Budget OV January February March Quarter $ 6,000 64,000 70,000 Cash balance, beginning Add cash collections. Total cash available Less cash disbursements: For inventory For operating expenses For equipment Total cash disbursements. Excess (deficiency) of cash Financing Etc. 1 45,150 19,400 3,000 67,550 2,450 5. Prepare an absorption costing income statement, s: for the quarter ended March 31. 6. Prepare a balance sheet as of March 31