Patel Company is a retail company that specializes in selling outdoor camping equipment. The company is considering opening a new store on October 1, 2012. The company president formed a planning committee to prepare a master budget for the first three months of operation. As budget coordinator, you have been assigned the following tasks. Required: a.&b. October sales are estimated to be $120,000 of which 40 percent will be cash and 60 percent will be credit. The company expects sales to increase at the rate of 25 percent per month. The company expects to collect 100 percent of the accounts receivable generated by credit sales in the month following the sale. Prepare a sales budget and a schedule of cash receipts. (Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.) Oct Nov Dec. Sales Budget Cash sales Sales on account Total budgeted sales Schedule of Cash Receipts Current cash sales Plus collections from $0 $0 $0 A/R Total collections $0 $ O $O c.&d. The cost of goods sold is 60 percent of sales. The company desires to maintain a minimum ending inventory equal to 10 percent of the next month's cost of goods sold. Ending inventory of December is expected to be $12,000. The company pays 70 percent of accounts payable in the month of purchase and the remaining 30 percent in the following month. Assume that all purchases are made on account. Prepare an inventory purchases budget and a cash payments budget for inventory purchases. (Leave no cells blank - be certain to enter "O" wherever required. Oct Nov Dec. Inventory Purchases Budget (Click to select) (Click to select) Inventory needed ( (Click to select) Required purchases (on account) $0 $0 $ O Schedule of Cash Payments Budget for Inventory Purchases Pmt. of current month's accts. $0 $0 pay. Pmt. for prior month's accts. pay. $O Total budgeted pmts. for inventory -.&f. Budgeted selling and administrative expenses per month follow. Sales Salary expense (fixed) $18,000 Sales commissions 5 percent of Sales Supplies expense percent of Utilities (fixed) $ 1,400 Depreciation on store equipment $ 4.000 (fixed)" Rent (fixed) $ 4,800 Miscellaneous (fixed) $ 1,200 * The capital expenditures budget indicates that Patel will spend $164,000 on October 1 for store fixtures, which are expected to have a $20,000 salvage value and a three-year (36-month) useful life. Utilities and sales commissions are paid the month after they are incurred; all other expenses are paid in the month in which they are incurred. Use this information to prepare a selling and administrative expenses budget and a cash payments budget for selling and administrative expenses. (Leave no cells blank be certain to enter "0" wherever required. Omit the "$" sign in your response.) Selling and Administrative Expense Budget Salary expense Sales commissions Supplies expense Utilities Depreciation on store fixtures Rent Miscellaneous Total S&A expenses Schedule of Cash Payments for S&A Expenses Salary expense Sales commissions Supplies expense Utilities Depreciation on store fixtures Rent Miscellaneous Total payments for S&A expenses g. Patel borrows funds, in increments of $1,000, and repays them on the last day of the month. Repayments may be made in any amount available. The company also pays its vendors on the last day of the month. It pays interest of 1 percent per month in cash on the last day of the month. To be prudent, the company desires to maintain a $12,000 cash cushion. Prepare a cash budget. (Leave no cells blank - be certain to enter "0" wherever required. Input all amounts as positive values except any shortage and repayments which should be indicated with a minus sign. Round your answers to the nearest dollar amount. Omit the "$" sign in your response.) Cash Budget Dec. (Click to select) (Click to select) Cash available Less payments (Click to select) (Click to select) ( (Click to select) (Click to select) Total budgeted payments Payments minus receipts ( (Click to select) Financing activity (Click to select) (Click to select) h. Prepare a pro forma income statement for the quarter. (Amounts to be deducted should be indicated with a minus sign. Omit the "$" sign in your response.) Patel Company Pro Forma Income Statement For the Quarter Ended December 31, 2012 ((Click to select) (Click to select) (Click to select) (Click to select) (Click to select) (Click to select) (Click to select) i. Prepare a pro forma balance sheet at the end of the quarter. (Be sure to list the assets and liabilities in order of their liquidity. Amounts to be deducted should be indicated with a minus sign. Omit the "$" sign in your response.) Patel Company Pro Forma Balance Sheet December 31, 2012 Assets ((Click to select) (Click to select) (Click to select) (Click to select) (Click to select) > > (Click to select) Total assets Liabilities (Click to select) (Click to select) (Click to select) (Click to select) Equity (Click to select) Total liabilities and equity j. Prepare a pro forma statement of cash flows for the quarter. (Leave no cells blank - be certain to enter "O" wherever required. Amounts to be deducted should be indicated with a minus sign. Omit the "$" sign in your response.) Patel Company Pro Forma Statement of Cash Flows For the Quarter Ended December 31, 2012 Cash flows from operating activities (Click to select) (Click to select) (Click to select) (Click to select) Net cash flows from operating activities Cash flows from investing activities (Click to select) Cash flow from financing activities (Click to select) (Click to select) (Click to select) (Click to select)