Problem 8-29 Completing a Master Budget [LO8-2, LO8-4, LO8-7, LO8-8, LO8-9, L08-10] The following data relate to the operations of Shilow Company, a wholesale distributor of consumer goods: Current assets as of March 31: $ 7,700 20,800 40,800 129,600 $ 24,300 s150,000 s 24,600 Cash Accounts receivable Inventory Accounts payable Common stock Retained earnings a. The gross margin is 25% of sales. b. Actual and budgeted sales data: March (actual) 5 April Ha June July $ 52,000 68,000 S 73,000 98,000 $ 49,000 c. Sales are 60% for cash and 40% on credit. Credit sales are collected in the month following sale. The accounts receivable at March 31 are a result of March credit sales d. Each month's ending inventory should equal 80% of the following month's budgeted cost of goods sold purchases is paid for in the month of purchase; the other half is paild for in the following month. The accounts payable at March 31 are the result of March purchases of inventory. of sales. Assume f. Monthly expenses are as folkws commissions, 12% of sales: rent, $2,500 per month other expenses (excluding depreciation), os e that these expenses are paid monthly. Depreciation is $972 per month (includes depreciation on new assets). g. Equipment costing $1,700 will be purchased for cash in April h. Management would like to m aintain a minimum cash balance of at least $4,000 at the end of each month. The company has an increments of $1,000 at the beginning of each month, up to a agreement with a local bank that allows the company to borrow in total loan balance of $20,000. The interest rate on these loans is 1% per month and forsi plicity we wil assume that interest is not compounded. The company would, as far as it is able, repay the loan plus accumulated interest at the end of the quarter Required: Using the preceding data: 1. Complete the schedule of expected cash collections. 2. Complete the merchandise purchases budget and the schedule of expected cosh disbursements for merchandise purchases. 3. Complete the cash budget 4. Prepare an absorption costing income statement for the quarter ended June 30. 5. Prepare a balance sheet as of June 30. 5. Prepare a balance sheet as of June 30. Complete this question by entering your answers in the tabs below. Required1Required 2 Required 3 Required 4 Required 5 Complete the schedule of expected cash collections. Schedule of Expected Cash Collections April May June Quarter $40,800 Cash sales Credit sales Total collections 20,800 61,600$ 0 Required 2 Required 1 Required 2 Required 3Required 4 Required 5 Complete the merchandise purchases budget and the schedule of expected cash disbursements for mercha Merchandise Purchases Budget April May June Quarter Budgeted cost of goods sold $ 51,000 $54,750 43,800 94,800 54,750 40,800 Total needs Less beginning merchandise inventory Required purchases Budgeted cost of goods sold for April-$68,000 sales x75%-$51,000. Add desired ending inventory for April $54,750 x 80% $43,800 0 $ 54,000 54.7650 S S Schedule of Expected Cash Disbursemen erchandise Purchases April Ma $ 24,300 27,000 27,000 June Quarter S 24,300 March purchases April purchases May purchases June purchases Total disbursements 54,000 $51,300 $27,000 $ 0 $ 78.300 K Required 1 Complete this question by entering your answers in the tabs below Required 1 Required 2 Required 3Required 4 Required 5 Complete the cash budget. (Cash deficiency, repayments and interest should be indicated by a minus sign.) Shilow Company Cash Budget April Quarter $ 7,700 61,600 69,300 Total cash available 0 Less cash disbursements For inventory For expenses For equipment 51,300 14,740 1,700 67,740 1,560 Financing: Repayments Total financing $ 1,560OS Complete this question by entering your answers in the tabs below an a Income Statement Complete this question by entering your answers in the tabs below Prepare a balance sheet as of June 30 Balance Sheet 30 Total assets