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 $ $9,100$

Accounts receivable $77,250$

Inventory $40,000$

Buildings and equipment, net of depreciation $239,000$

Total assets $ $365,350$

Liabilities and Stockholders$$ Equity

Accounts payable $ $79,750$

Note payable $12,300$

Common stock $180,000$

Retained earnings $93,300$

Total liabilities and stockholders$$ equity $ $365,350$

The company is in the process of preparing a budget for May and assembled the following data:

Sales are budgeted at $$266,000$ for May. Of these sales, $$79,800$ 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 are collected in the following month. All of the April $30$ accounts receivable will be collected in May.

Purchases of inventory are expected to total $$170,000$ 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.

The May $31$ inventory balance is budgeted at $$44,500.$

Selling and administrative expenses for May are budgeted at $$81,900,$ exclusive of depreciation. These expenses will be paid in cash. Depreciation is budgeted at $$6,450$ for the month.

The note payable on the April $30$ balance sheet will be paid during May, with $$140$ in interest. $($All of the interest relates to May.$)$

New refrigerating equipment costing $$9,600$ will be purchased for cash during May.

During May, the company will borrow $$23,400$ 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:

For May:

Calculate the expected cash collections from customers.

Calculate the expected cash disbursements for merchandise purchases.

Prepare a cash budget.

Prepare a budgeted income statement.

Prepare an end$-$of$-$month budgeted balance sheet.ask a question?