Modern company is a wholesale distributor of premium european chocolates. The company's balnce sheet as of april 30 is given below: The company is in the process of preparing a budget for May and has assembled the following data;

Sales are budgeted at $247,000 for May. Of these sales, $74,100 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.

Purchases of inventory are expected to total $172,000 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 $58,500.

Selling and administrative expenses for May are budgeted at $87,600, exclusive of depreciation, These expenses will be paid in cash. Depreciation is budgeted at $6,850 for the month,

The note payable on the April 30 balance sheet will be paid during May, with $400 in interest. (All of the interest relates to May.)

New refrigerating equipment costing $13,400 will be purchased for cash during May.

During May, the company will borrow $22,900 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: [8 marks]

Using the information provided, prepare the following:

1. The budgeted expected cash collections from customers for May. [1 marks]

2. The budgeted expected cash disbursements for merchandise purchases for May. [1 marks]

3. The cash budgeted for May. [5 marks]

Modern Company is a wholesale distributo Modern Company Balance Sheet April 30 Assets Cash $14,500 Accounts receivable 72,750 Inventory 31,750 209,000 Buildings and equipment, net of depreciation Total assets $ 328,000 Liabilities and Stockholders' Equity Accounts payable $ 69,500 $16,000 Note payable Common stock 180,000 Retained earnings 62,500 $328,000 Total liabilities and stockholders' equity The company is in the process of preparing a budget for May and has assembled the following data: Sales are budgeted at $247,000 for May. Of these sales, $74,100 will be for cash; the remainder will be credit sales. One-half. and the remainder is collected in the following month. All of the April 30 accounts receivable will be collected in May. Purchases of inventory are expected to total $172,000 during May. These purchases will all be on account. Forty percent of all 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 $58,500. elling and administrative expenses for May are budgeted at $87,600, exclusive of depreciation. These expenses will be paid in e note payable on the April 30 balance sheet will be paid during May, with $400 in interest. (All of the interest relates to Ma