Janus Products, Inc. is a merchandising company that sells binders; paper and other school supplies. The company is planning its casth needs for the third quarter. In the past, Janus Products has had to borrow money during the third quarter to support peak sales of back-to-school materials, which occur during August. The following information has been assembled to assist in preparing a cash budget for the quarter a. Budgeted monthly absorption costing income statements for July to October are as follows Insludes $2,650 depreciation each month. b. Sales are 20% for cash and 80% on credit. c. Credit sales are collected over a three-month period, with 10% collected in the month of sale, 70% in the month following sale, and 20% in the second month following sale. May sales totalled $43,000, and June sales totalled $49,000, d. Inventory purchases are paid for within 15 days. Therefore, 50% of a month's inventory puichases are paid for in the month of purchase. The remaining 50% are paid in the following month. Accounts payable for inventory purchases at Juhe 30 total $18200. e. The company maintains its ending imventory tevels at 75% of the cost of the merchandise to be sold in the following month. The merchandise inventory at June 30 is $24,500. t Land costing $5.150 will be purchosed in July 9. Dividends of $1,650 will be declared and paid in September h. The cash balance on June 30 is $9.300 the company must maintain a cash balance of at least this amount at the end of each month. 1. The company has an agreement with a local bank that allows it to borrow in increments of $1,000 at the beginning of each month. up to a total loan balance or $40,000 The interest rate on these loans is 1% per month, ard for simplicity, wo will assume ihat interest is not compounded. The company wouid, as far as if is able, repay the loan plus occumulated interest at ine end of the quater: Janus Products, Inc. is a merchandising company that sells binders; paper and other school supplies. The company is planning its casth needs for the third quarter. In the past, Janus Products has had to borrow money during the third quarter to support peak sales of back-to-school materials, which occur during August. The following information has been assembled to assist in preparing a cash budget for the quarter a. Budgeted monthly absorption costing income statements for July to October are as follows Insludes $2,650 depreciation each month. b. Sales are 20% for cash and 80% on credit. c. Credit sales are collected over a three-month period, with 10% collected in the month of sale, 70% in the month following sale, and 20% in the second month following sale. May sales totalled $43,000, and June sales totalled $49,000, d. Inventory purchases are paid for within 15 days. Therefore, 50% of a month's inventory puichases are paid for in the month of purchase. The remaining 50% are paid in the following month. Accounts payable for inventory purchases at Juhe 30 total $18200. e. The company maintains its ending imventory tevels at 75% of the cost of the merchandise to be sold in the following month. The merchandise inventory at June 30 is $24,500. t Land costing $5.150 will be purchosed in July 9. Dividends of $1,650 will be declared and paid in September h. The cash balance on June 30 is $9.300 the company must maintain a cash balance of at least this amount at the end of each month. 1. The company has an agreement with a local bank that allows it to borrow in increments of $1,000 at the beginning of each month. up to a total loan balance or $40,000 The interest rate on these loans is 1% per month, ard for simplicity, wo will assume ihat interest is not compounded. The company wouid, as far as if is able, repay the loan plus occumulated interest at ine end of the quater