Modern Company is a wholesale distributor of premium European chocolates. The company's balance sheet as of April 30 is given below: Modern Company Balance Sheet April 30 Assets Cash $18,500 Accounts receivable 58,500 Inventory 40,750 Buildings and equipment, net of depreciation 202,000 Total assets $319,750 Liabilities and Stockholders' Equity $ 67,750 Accounts payable $15 800 Note navable 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 $18,500 58,500 40,750 202,000 $ 319,750 $ 67,750 $15,800 180,000 56,200 $319.750 The company is in the process of preparing a budget for May and has assembled the following data: Sales are budgeted at $263,000 for May. Of these sales, $78,900 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 $193,000 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 $63,000. Selling and administrative expenses for May are budgeted at $73,200, exclusive of depreciation. These expenses will be paid in cash. Depreciation is budgeted at $4,650 for the month. The note payable on the April 30 balance sheet will be paid during May, with $300 in interest. (All of the interest relates to May.) New refrigerating equipment costing $11,900 will be purchased for cash during May. During May, the company will borrow $27,200 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: Required: Using the information provided, prepare the following: 1. The budgeted expected cash collections from customers for May. [2 marks] 2. The budgeted expected cash disbursements for merchandise purchases for May. [1 mark 3. The cash budgeted for May. (5 marks] Assets Modern Company Balance Sheet April 30 Cash Accounts receivable Inventory Buildings and equipment, net of depreciation Total assets Liabilities and Stockholders' Equity Accounts payable Note payable $18,500 58,500 40.750 202,000 $319,750 $ 67,750 $15.800 K E Gra P es remaining Note payable Common stock Retained earnings Total liabilities and stockholders' equity $15.800 180.000 56.200 $319,750 2 OF 5 QUESTIONS REMAINING 2 OF 5 QUESTIONS REMAINING The company is in the process of preparing a budget for May and has assembled the following data: Sales are budgeted at $263,000 for May. Of these sales, $78,900 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 $193,000 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 $63,000. Selling and administrative expenses for May are budgeted at $73,200, exclusive of depreciation. These expenses will be paid in cash. Depreciation is budgeted at $4,650 for the month. The note payable on the April 30 balance sheet will be paid during May, with $300 in interest. (All of the interest relates to May.) New refrigerating equipment costing $11,900 will be purchased for cash during May. During May, the company will borrow $27,200 from its bank by giving a new note payable to the bank for that amount. The new note will be due in one year