Merchandise Purchases Budget
	April	May	June	Quarter
Budgeted Cost of Goods Sold	$ 45,000	$ 54,000	$ 67,500	$ 166,500
add: Desired Ending Inventory	43,200	54,000	28,800	$ 28,800
Total Needs	88,200	108,000	96,300	195,300
less: Beginning Inventory	36,000	$ 43,200	$ 54,000	$ 54,000
Required Purchases	$ 52,200	$ 64,800	$ 42,300	$ 159,300
Schedule of Expected Cash Disbursements - Merchandise Purchaes
	April	May	June	Quarter
March Purchases	$ 21,750			$ 21,750
April Purchases	26,100	26,100		52,200
May Purchases		27,900	27,900	55,800
June Purchases			20,250	20,250
Total Disbursements	$ 47,850	$ 54,000	$ 48,150	$ 150,000
Schedule of Expected Cash Disbursements - Selling & Administrative
	April	May	June	Quarter
Commissions	$ 7,200	$ 8,640	$ 10,800	$ 26,640
Rent	2,500	2,500	2,500	7,500
Other Expenses	3,600	3,600	3,600	10,800
Total Disbursements	$ 13,300	$ 14,740	$ 16,900	$ 44,940
Cash Budget
	April	May	June	Quarter
Cash Balance Beginning	$ 8,000	4,350
Add: Cash Collections	56,000	67,200
Total Cash Available	64,000	71,550
Less Cash Disbursements
For Inventory	47,850	54,000
For Expenses	13,300	14,740
For Equipment	1,500
Total Cash Disbursements	62,650	68,740
Excess (deficiency) of Cash	1,350	2,810
Borrowing	3,000
Repayments
Interest Paid
Ending Cash Balance	$ 4,350

The key information and instructions relamd to the project is listed below: The following data relate to the operations of Shilow Company, a wholesale distributor of consumer goods: a. The gross margin is 25% of sales. b. Actual and budgeted sales data: c. Sales are 60% for cash and 40% on credit. Credit sales are collected in the month following sale. The accounts receivable at March 31 are a result of March credit sales. d. Each month's ending inventory should equal 80% of the following month's budgeted cost of goods sold. e. One-half of a month's inventory purchases is paid for in the month of purchase; the other half is paid for in the following month. The accounts payable at March 31 are the result of March purchases of inventory. f. Monthly expenses are as follows: commissions, 12% of sales; rent, $2,500 per month; other expenses (excluding depreciation}, 6% of sales. Assume that these expenses are paid monthly. Depreciation is $900 per month (includes depreciation on new assets). 9. Equipment costing $1,500 will be purchased for cash in April. h. Management would like to maintain a minimum cash balance of at least $4,000 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 $20,000. The interest rate on these loans is 1% per month and {or simplicity we will 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. Using the data provided above, use the Excel Template provided to prepare the following budget schedules: 1. Sales Budget (Merely enter the sales data provided.) 2. Schedule of Expected Cash Collections 3. Merchandise Purchases Budget 0 4. Schedule of Expected Cash Disbursements - Merchandise Purchases 5. Schedule of Expected Cash Disbursements - Selling and Administrative Expenses 6. Cash Budget Please note that Excel formulas or functions should be used throughout the budget wherever possible, instead of entering numbers into each cell