Problem Set 2 Due: 6 pm sharp on April 26 Question! (26 marks): The Mobile Supply Company sells one product that is purchased for $20 and sold for $30. Budgeted sales in total dollars for next year are $720,000. The sales information needed for preparing the July budget is as follows: Month Sales Revenue Month Sales Revenue May $30,000 July $48,000 June 42,000 August 60,000 Account balances at July 1 include: Cash $15.000 Merchandise inventory 16,000 Accounts receivable (sales) 23,000 Accounts payable (purchases) 15,000 The company pays for one-half of its purchases in the month of purchase, and the remainder in the following month. End-of-month inventory must be 50 percent of the budgeted sales in units for the next month. A 2 percent cash discount on sales is allowed if payment is made during the month of sale. Experience indicates that 50 percent of the billings will be collected during the month of sale, 40 percent in the following month, 8 percent in the next following month, and 2 percent will be uncollectible. REQUIRED: a. (13 marks) Prepare a schedule of estimated cash collections for July. b. (13 marks) Prepare a schedule of estimated July cash payments for purchases. (Round calculations to the nearest dollar.)