Problem 10.49 Walker Products fell behind in paying its vendors, and it now has a poor credit rating. Consequently, all suppliers demand cash on delivery (even employees are paid on a daily basis). The firm has a note payable on which principal payments have been suspended. The firm must pay interest on this note at he rate o 1.5% p m of the beginning aance I Valker misses even one interest payment, the bank will initiate bankruptcy proceedings. The following is Walkers balance sheet as of October 1 Assets Liabilities and Equity Cash Accounts receivable (net) 1,000 Common stock Inventory Plant & equipment (net) Total assets $,000 Notes payable $86,000 75,000 (16,800) $144,200 44,200 73,000 Retained earnings (deficit) Total liabilities and equity $144,200 walker sells its product for $27 per unit. The purchase cost is $17 per unit. Budgeted sales for October are 2,500 units, and ending budgeted inventory is 1,800 units. Typically, 60% of Walker's customers pay in the month of sale, 35% in the month following purchase, and 5% never pay. Walker's employees are paid strictly on commission, based on 10% of sales. The firm depreciates to $15,000 per month. s fixed assets at he rate of S1 800 per month. Al other seling an administrative costs amount Your answer is partially correct. Try again. Prepare a cash receipts and disbursements budget for October. (Enter negative amounts using either a negative sign preceding the number e.g.-45 or parentheses e.g. (45).) Cash Receipts and Disbursements Bud Receipts October sales 40500 Prior months 21000 Total Receipts 61500 Disbursements Commissions 6750 Interest paid 1290 October sales 40500 Prior months 21000 Total Disbursements 69540 Excess Receipts (Disbursements) from Operations 8040 Prepare a budgeted income statement for October. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45)) Budgeted Income Statement Sales 67500 Cost of goods sold Gross Margin Operating expenses 42500 25000 Bad debts 3375 Commissions expense 6750 Interest Expense 1290 Your answer is partially correct. Try again. Prepare the budgeted balance sheet as of the end of October. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Assets Liabilities Accounts receivable (net) 23625 Accounts receivable (net) Property and equipment Retained earnings Property and equipment 71200 Retained earnings (Deficit) (20015) Total Assets Total Liabilities and Stockholder's Equity Total Assets SHOW SOLUTION LINK TO TEXT LINK TO TEXT LINK TO TEXT