Need 1-8 (all of them) and wanting to know if the first

one is correct

Problem 20-8AA Merchandising: Preparation of a complete master budget LO P4 Near the end of 2017, the management of Dimsdale Sports Co., a merchandising company, prepared the following estimated balance sheet for December 31, 2017 $ 711,000 DIMSDALE SPORTS COMPANY Estimated Balance Sheet December 31, 2017 Assets Cash $ 36,000 Accounts receivable 525,000 Inventory 150,000 Total current assets Equipment 540,000 Less: accumulated depreciation 67,500 Equipment, net Total assets Liabilities and Equity Accounts payable $360,000 Bank loan payable 15,000 Taxes payable (due 3/15/2018) 90,000 Total liabilities Common stock 472,500 Retained earnings 246,000 Total stockholders' equity Total liabilities and equity 472,500 $1,183,500 $ 465,000 718,500 $1,183,500 To prepare a master budget for January, February, and March of 2018, management gathers the following information. a. The company's single product is purchased for $30 per unit and resold for $55 per unit. The expected Inventory level of 5,000 units on December 31, 2017, is more than management's desired level, which is 20% of the next month's expected sales in units) Expected sales are: January, 7,000 units; February 9,000 units; March 11,000 units; and April, 10,000 units. b. Cash sales and credit sales represent 25% and 75%, respectively, of total sales. Of the credit sales, 60% is collected in the first month after the month of sale and 40% in the second month after the month of sale. For the December 31, 2017, accounts receivable balance, $125,000 is collected in January and the remaining $400,000 is collected in February To prepare a master budget for January, February, and March of 2018, management gathers the following information. a. The company's single product is purchased for $30 per unit and resold for $55 per unit. The expected inventory level of 5,000 units on December 31, 2017, is more than management's desired level, which is 20% of the next month's expected sales (in units). Expected sales are: January, 7,000 units; February, 9,000 units; March, 11,000 units; and April 10,000 units. b. Cash sales and credit sales represent 25% and 75%, respectively, of total sales. Of the credit sales, 60% is collected in the first month after the month of sale and 40% in the second month after the month of sale. For the December 31, 2017, accounts receivable balance, $125,000 is collected in January and the remaining $400,000 is collected in February c. Merchandise purchases are paid for as follows: 20% in the first month after the month of purchase and 80% in the second month after the month of purchase. For the December 31, 2017, accounts payable balance, $80,000 is paid in January and the remaining $280,000 is paid in February d. Sales commissions equal to 20% of sales are paid each month. Sales salaries (excluding commissions) are $60,000 per year. e. General and administrative salaries are $144,000 per year. Maintenance expense equals $2,000 per month and is paid in cash. f. Equipment reported in the December 31, 2017, balance sheet was purchased in January 2017. It is being depreciated over eight years under the straight-line method with no salvage value. The following amounts for new equipment purchases are planned in the coming quarter: January, $36,000; February. $96,000; and March, $28,800. This equipment will be depreciated under the straight- line method over eight years with no salvage value. A full month's depreciation is taken for the month in which equipment is purchased. g. The company plans to buy land at the end of March at a cost of $150,000, which will be paid with cash on the last day of the month. h. The company has a working arrangement with its bank to obtain additional loans as needed. The interest rate is 12% per year, and interest is paid at each month-end based on the beginning balance. Partial or full payments on these loans can be made on the last day of the month. The company has agreed to maintain a minimum ending cash balance of $25,000 at the end of each month. i. The income tax rate for the company is 40%. Income taxes on the first quarter's income will not be paid until April 15. Required: Prepare a master budget for each of the first three months of 2018; include the following component budgets: 1. Monthly sales budgets. 2. Monthly merchandise purchases budgets. 3. Monthly selling expense budgets. 4. Monthly general and administrative expense budgets. 5. Monthly capital expenditures budgets. 6. Monthly cash budgets. 7. Budgeted income statement for the entire first quarter (not for each month). 8. Budgeted balance sheet as of March 31, 2018. 1. Monthly sales budgets. 2. Monthly merchandise purchases budgets. 3. Monthly selling expense budgets. 4. Monthly general and administrative expense budgets. 5. Monthly capital expenditures budgets. 6. Monthly cash budgets. 7. Budgeted income statement for the entire first quarter (not for each month). 8. Budgeted balance sheet as of March 31, 2018 Complete this question by entering your answers in the tabs below. Required 1 Required 4 Required 5 Required 7 Required 2 Required 3 Required 6 Calc Required 8 Required 6 Cash Bud Monthly sales budget DIMSDALE SPORTS CO. Sales Budget For January, February, and March 2018 Budgeted Unit Budgeted Budgeted Total Sales Unit Price Dollars January 7,000 $ 55 55 February 9,000 55 495,000 March 11,000 55 605,000 Totals for the quarter 27,000 1,100,055 Required 1 Required 2 >