Minden Company is a wholesale distributor of premium European chocolates. The company's balance sheet as of April 30 is given below: Minden Company Balance Sheet April 30 Assets Cash Accounts receivable Inventory Buildings and equipment, net of depreciation Total assets Liabilities and Stockholders' Equity Accounts payable Note payable Common stock Retained earnings Total liabilities and stockholders' equity $ 15,800 70,200 38,750 222,000 $ 346,750 $ 74,750 14,700 180,000 77,300 $ 346,750 The company is in the process of preparing a budget for May and has assembled the following data: a. Sales are budgeted at $260,000 for May. Of these sales, $78,000 will be for cash; the remainder will be credit sales. One-half of a month's credit sales are collected in the month the sales are made, and the remainder is collected in the following month. All of the April 30 accounts receivable will be collected in May. b. Inventory purchases are expected to total $155,000 during May. These purchases will all be on account. Forty percent of all purchases are paid for in the month of purchase; the remainder are paid in the following month. All of the April 30 accounts payable to suppliers will be paid during May. c. The May 31 inventory balance is budgeted at $59,500. d. Selling and administrative expenses for May are budgeted at $99,500, excluding depreciation. These expenses will be paid in cash. Depreciation is budgeted at $4,550 for the month. e. New refrigerating equipment costing $11,000 will be purchased for cash during May. f. The note payable on the April 30 balance sheet will be paid during May, with $460 in interest. (All of the interest relates to May.) g. During May, the company will borrow $21,500 from its bank by giving a new note payable to the bank for that amount. The new note will be due in one year. Required: 1. Calculate the expected cash collections from customers for May. 2. Calculate the expected cash disbursements for merchandise purchases for May. 3. Prepare a cash budget for May. (Hint: In the financing section, make sure to denote cash outflows as negative numbers. In the cash disbursements section, the cash outflows should be written as positive numbers. I know this seems counterintuitive - accountants tend to write costs as positive numbers if they are listed in a section of the financial statements that is already labeled as "costs" or "expenses" or "disbursements" because then you know they are all outflows. But in a section where inflows and outflows are mixed, like in the financing section, they make the outflows negative numbers.) 4. Prepare a budgeted income statement for May. (Hint: here, the interest payment will have a positive sign. Another hint: Remember from ACTG 211 that Cost of Goods Sold = beginning inventory account balance + inventory purchase cost - ending inventory account balance.) 5. Prepare a budgeted balance sheet as of May 31. (Hint: You won't need every line on the worksheet. There should be four 'asset' items and four 'liability and owners' equity' items, matching the categories in the beginning balance sheet above. Another hint: Remember from ACTG 211 that "Buildings and Equipment, net of depreciation" is increased every month by any new building or equipment purchases, and decreased by any depreciation. May depreciation is given in part d above.)