Problem 8-29 (Static) Completing a Master Budget [LO8-2, LO8-4, LO8-7, LO8-8, LO8-9, LO8-10] The following data relate to the operations of Shilow Company, a wholesale distributor of consumer goods: Current assets as of March 31: Cash Accounts receivable Inventory Building and equipment, net Accounts payable Common stock Retained earnings a. The gross margin is 25% of sales. b. Actual and budgeted sales data: March (actual) April May June July Required: Using the preceding data: c. Sales are 60% for cash and 40% on credit. Credit sales are collected in the month following sale. The accounts receivable at M 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. e. One-half of a month's inventory purchases is paid for in the month of purchase; the other half is paid for in the following month accounts payable at March 31 are the result of March purchases of inventory. f. Monthly expenses are as follows: commissions, 12% of sales; rent, $2,500 per month; other expenses (excluding depreciation) of sales. Assume that these expenses are paid monthly. Depreciation is $900 per month (includes depreciation on new assets g. Equipment costing $1,500 will be purchased for cash in April. h. Management would like to maintain a minimum cash balance of at least $4,000 at the end of each month. The company has a agreement with a local bank that allows the company to borrow in increments of $1,000 at the beginning of each month, up to total loan balance of $20,000. The interest rate on these loans is 1% per month and for simplicity we will assume that interest i compounded. The company would, as far as it is able, repay the loan plus accumulated interest at the end of the quarter. 1. Complete the schedule of expected cash collections. 2. Complete the merchandise purchases budget and the schedule of expected cash 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. Reqed 1 $ 50,000 $ 60,000 $ 72,000 $ 90,000 $ 48,000 Complete this question by entering your answers in the tabs below. Cash sales Credit sales Total collections Required 2 Required 3 Complete the schedule of expected cash collections. Schedule of Expected Cash Collections April May June 36,000 20,000 $ 56,000 $ $ 8,000 $ 20,000 $ 36,000 $ 120,000 $ 21,750 $ 150,000 $ 12,250 Required 4 Required 1 Required 5 Quarter Required 2 >

Problem 8-29 (Static) Completing a Master Budget [LO8-2, LO8-4, LO8-7, LO8-8, LO8-9, LO8-10] The following data relate to the operations of Shilow Company, a wholesale distributor of consumer goods: a. The gross margin is 25% of sales. b. Actual and budgeted sales data: c. Sales are 60x for cash and 40% on credit. Credit saies are collected in the month following sale. The accounts receivable at A 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 e. One-half of a month's inventory purchases is paid for in the month of purchase; the other haif is poid for in the following monti accounts payable at March 31 are the result of March purchases of inventory. t Monthly expenses are as follows: commissions, 12% of sales; rent, $2.500 per month, other expenses (excluding depreciation) of sales. Assume that these expenses are paid monthly. Depreclation is 5900 per month fincludes depreciation on new asset g. Equipment costing $1,500 will be purchased for cash in Aprl. h. Management would tike to maintain a minimum cash bolance of at least $4,000 at the end of each month. The company has a agreement with a local bank that allows the company to borrow in increments of $1,000 at the beginning of each month, up tc total loan bolance of $20.000. The interest rate on these loans is 13 per month and for simplicity we will assume that interest i 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 cash disbursements for merchandise purchases 3. Complete the eash budget. 4. Prepare an absorption costing income statement for the quarter ended dune 30 . 5. Prepare a balance sheet as of June 30 . Complete this question by entering your answers in the tabs below. Complete the schedule of expected cash coliections. Problem 8-29 (Static) Completing a Master Budget [LO8-2, LO8-4, LO8-7, LO8-8, LO8-9, LO8-10] The following data relate to the operations of Shilow Company, a wholesale distributor of consumer goods: a. The gross margin is 25% of sales. b. Actual and budgeted sales data: c. Sales are 60x for cash and 40% on credit. Credit saies are collected in the month following sale. The accounts receivable at A 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 e. One-half of a month's inventory purchases is paid for in the month of purchase; the other haif is poid for in the following monti accounts payable at March 31 are the result of March purchases of inventory. t Monthly expenses are as follows: commissions, 12% of sales; rent, $2.500 per month, other expenses (excluding depreciation) of sales. Assume that these expenses are paid monthly. Depreclation is 5900 per month fincludes depreciation on new asset g. Equipment costing $1,500 will be purchased for cash in Aprl. h. Management would tike to maintain a minimum cash bolance of at least $4,000 at the end of each month. The company has a agreement with a local bank that allows the company to borrow in increments of $1,000 at the beginning of each month, up tc total loan bolance of $20.000. The interest rate on these loans is 13 per month and for simplicity we will assume that interest i 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 cash disbursements for merchandise purchases 3. Complete the eash budget. 4. Prepare an absorption costing income statement for the quarter ended dune 30 . 5. Prepare a balance sheet as of June 30 . Complete this question by entering your answers in the tabs below. Complete the schedule of expected cash coliections