Nordic Company, a merchandising company, prepares its master budget on a quarterly basis. The following data have been assembled to assist in the preparation of the master budget for the second quarter of the year 2020.

1. As of March 31, 20__ (the end of the prior quarter), the companys balance sheet showed the following account balances:

Cash		$9,000
Accounts Receivable		36,000
Inventory		12,600
Plant and Equipment (net)		214,100
Accounts Payable				$24,000
Capital Stock				190,000
Retained Earnings				57,700
		$271,700		$271,700

1. Actual sales for March and budgeted sales for April July are as follows:

March (actual) $60,000

April .. 70,000

May ... 85,000

June . 90,000

July 50,000

2. Sales are 40% for cash and 60% on credit. All payments on credit sales are collected in the month following the sale. The accounts receivable at March 31 are a result of March credit sales.

3. The companys gross profit is 40% of sales.

4. Monthly expenses are budgeted as follows: salaries and wages, $9,500 per month; shipping, 7% of sales; advertising, $8,000 per month; depreciation, $2,400 per month; other expenses, 5% of sales.
5. At the end of each month, a minimum level of inventory is to be on hand equal to 30% of the following months sales needs.

6. Half of a months inventory purchases are paid in the month of purchase and half in the following month after purchase.

7. Equipment purchases during the quarter will be as follows:

April, $15,000; and June, $4,000.

8. Dividends totaling $2,500 will be declared and paid in June.

1. The company must maintain a minimum cash balance of $7,000. An open line of credit is available from a local bank. All borrowing is done at the beginning of a month, and all repayments are made at the end of a month.

Borrowings and repayments of principal must be in multiples of $1,000. Interest is paid only at the time of repayment of principal. The annual interest rate is 10%.

Required: Using the data above, prepare the following statements and schedules for the second quarter of the year 2020:

1. Sales budget
2. Cash collections from customers schedule
3. Inventory purchases budget
4. Cash disbursements for purchases schedule
5. Operating expenses budget
6. Cash disbursements for expenses schedule
7. Cash budget
8. Income statement for the quarter ending June 30, 2020
9. Balance sheet as of June 30, 2020