Question 1 in this assignment will not be graded. However you NEED it for the facts of the problem assigned specifically to you and you will use it to check answers from the excel spreadsheet. You will turn in the excel spreadsheet as your Budget Project, part 1 and THAT will be graded Once you get the correct numbers in your spreadsheet you do not to to re-enter them below. Just enter the numbers you are still needing to check. (Remember, Question 1, is not graded.) Question 2 in this assignment must be completed in OWL and is GRADED. Your points on this question are your grade for Budget Project, part 2 Save your excel budget as you go. You will need it to complete OWL question 2, as well as to turn in as Budget Project, Part 1 Esteem is a retail company that sells specialized gardening products. The company is considering opening a new store on October 1, Year1. As budget coordinator, you have been asked to prepare a master budget for the first 3 months of the company's operation. You have gathered the following information October sales are estimated to be $350000 of which 40 percent will be cash and the remainder will be on credit. The company expects all sales to increase at the rate of 20 percent per month for November and December. Sales in January Year 2 are expected to be $320000 The company expects to collect 100 percent of the accounts recelvable generated by credit sales in the month following the sale. Prepare a sales budget and a schedule of cash receipts using these facts and your excel template. Check your answers here before moving to the next part, by completing the cells requested in the chart below. a. Sales Budget Cash sales Sales on account Total budgeted sales October November December Total-Qtr b. Schedule of Cash Receipts Current cash sales Plus collections from AVFR Total collections October November December Total-Qtr 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 for December is based on budgeted January Year2 sales.) Assume that all inventory purchases are made on account (on credit). The company pays 30 percent of accounts payable in the month of purchase and the remaining amount in the following month In excel, prepare an inventory purchases budget and a cash payments budget for inventory purchases. Use the check figures below before you continue. Inventory Purchases Budget ed cost of goods sold s desired ending inventory October NovemberDecembe Total-Qtr needed ess beginning inventory equired purchases (on account) d. Cash payments for inven Payment of current month's AVF Payment for prior month's A/P Total budgeted payments Budgeted selling and administrative expenses per month follow. October November December Total-Qtr Salary expense (fixed): 28900 Sales commissions: 5 percent of Sales Supplies expense: 2 percent of Sales . Utilities (fixed): $1500 Depreciation on store equipment (fixed): You compute . Rent (fixed) $ 13000 . Miscellaneous (fixed): $ 2700 The capital expenditures budget indicates that the company will spend $370000 on October 1 for store fixtures, which are expected to have a $10000 residual value and a 48 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. In excel, prepare the selling and administrative expenses budget and the cash payments budget for selling and administrative expenses. Check the key figures below. Selling and Admin.Expense Budget Salary expense Sales commissions Supplies expense Utilities Depreciation on store fixtures Rent October November December Total-Qtr Total S&A expenses f. Cash payments for S&A Salary expense Sales commissions Supplies expense October November December Total-Qtr Depreciation on store fixtures Rent Miscellaneous Total payments for S&A expenses Esteem issued common stock for S220000 on October 5 A dividend of $115000 was paid on December 15. The company borrows and repays funds in increments of $1,000 on the last day of the month. 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 $30000 cash cushion. Prepare a cash budget on your excel template. Check key figure below. g. Cash Budget Beginning cash balance October November December Total-Qtr Issuance of stock Cash available Less payments For inventory purchases For S&A expenses Purchase of store fixtures Pay dividend Interest expense Total budgeted payments Cash balance before borrow/repay Financing activity Ending cash balance