Need all three of the budget tables to be filled out in full using the information to the left.

Jack Hanson, the assistant controller, is now preparing a monthly budget for the first quarter of 20x1. In the process, the following information has been accumulated: 1. Projected sales for December Of 20xO are $500,000. Credit sales typically are 60 percent of total sales. Intercoastal's credit experience indicates that 30 percent of the credit sales are collected during the month of sale, and the remainder are collected during the following month. 2. Intercoastal's cost Of goods sold generally runs at 70 percent Of sales. Inventory is purchased on account, and 50 percent of each month's purchases are paid during the month of purchase. The remainder is paid during the following month. In order to have adequate stocks of inventory on hand, the firm attempts to have inventory at the end Of each month equal to half Of the next month's projected cost Of goods sold. 3. Hanson has estimated that Intercoastal's other monthly expenses will be as follows: Required information (The following information applies to the questions displayed below.) "We really need to get this new material-handling equipment in operation just after the new year begins. I hope we can finance it largely with cash and marketable securities, but if necessary we can get a short-term loan down at MetroBank." This statement by Beth Davies-Lowry, president Of Intercoastal Electronics Company, cor.c!udcd mcctmg shc had .c ..rm's top mar.z:gcmcnt. !r.tvrcoastal is a small, rapidly growi ng wholesaler of consumer electronic products. The firm's main product lines are small kitchen appliances and :ools. Marcia Wilcox, Intercoastal's General Manager of Marketing, has recently completed a sales torecast. Sne believes tne company's sales during tne tirst quarter Of 20x1 will increase by 10 perceOeach month over the previous month's sales. Then Wilcox expects sales to remain constant for several months. Intercoastal's projected balance sheet as of December 31, 20xO, is as follows: 210, 192,500 547 , 183, 750 150 , , o 178,975 $35, 3. Purchases budget: December Bud eted cost of oods sold Add: Desired endin invento Total oods needed Less: Expected beginning invento Purchases Invento urchases: January x First February March _Quarte Cash Accounts receivable Marketable securities Inventory Buildings and equipment (net accumulated depreciation) Total assets Accounts payable Bond interest payable Property taxes payable of 50 , o 25, o 9,375 $1, 024, 5 4. Cash disbursements budget: (Round your inventory purchases up to the nearest whole dollar.) January 1 ,ooo 1 ,ooo February March First Quarter Bonds payable (15%; due in 20x6) Common stock Retained earnings Total liabilities and stockholders' equity Cash payments for purchases during the current month Cash payments for purchases during the recedin month Total cash a ments for invento urchases Other ex nses: Sales salaries Advertisin and romotion Administrative salaries Interest on bonds pro taxes Sales commissions Total cash a ments for other ex enses Total cash disbursements Sales salaries Advertising and promotion Administrative sa ries Depreciation Interest on bonds Property taxes 5. Complete the first three lines of the summary cash budget. Then do the analysis of short-term financing needs in 16, 35 , 15, 1, 875 600 requirement 6. Then finish requirement 5. Cash recei ts from art 2 Less: Cash disbursements from art 4 Change in cash balance during period due to Ox January February March First Quarter In addition, sales commissions run at the rate ofl percent of sales. 4. Intercoastal's president, Davies-Lowry, has indicated that the firm should invest $125,000 in an automated inventory-handling system to control the movement Of inventory in the firm's warehouse just after the new year begins. These equipment purchases will be financed primarily from the firm's cash and marketable securities. However, Davies-Lowry believes that Intercoastal needs to keep a minimum cash balance of $25,000. If necessary, the remainder of the equipment purchases will be financed using short-term credit from a local bank. The minimum period for such a loan is three months. Hanson believes short-term interest rates will be 10 percent per year at the time of the equipment purchases. If a loan is necessary, Davies-Lowry has decided it should be paid off by the end of the first quarter if possible. 5. Intercoastal's board Of directors has indicated an intention to declare and pay dividends Of $50,000 on the last day of each quarter. 6. The interest on any short-term borrowing will be paid when the loan is repaid. Interest on Intercoastal's bonds is paid semiannually on January 31 and July 31 for the preceding six-month period. 7. Property taxes are paid semiannually on February 28 and August 31 for the preceding six-month period. Required: Prepare Intercoastal Electronics Companys master budget for the first quarter of 20x1 by completing the following schedules and statements. o rations Sale of marketable securities 1/2/x1 Proceeds from bank loan 1/2/xI Purchase Ofe ui ment Re a ment of bank loan 3/31/x1 Interest on bank loan Pa ment of dividends Chan e in cash balance durin first Cash balance, Ill/xl Cash balance, 3/31/xI uarter