Required information Exercise 8-12 and 13 Schedules of Expected Cash Collections and Disbursements; Income Statement; Balance Sheet (LO8-2, LO8-4, LO8-9, LO8-10] (The following information applies to the questions displayed below.] Beech Corporation is a merchandising company that is preparing a master budget for the third quarter of the calendar year. The company's balance sheet as of June 30th is shown below: Beech Corporation Balance Sheet June 30 Assets Cash Accounts receivable Inventory Plant and equipment, net of depreciation Total assets Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings Total liabilities and stockholders' equity $ 90,000 136,000 62,000 210,000 $ 498,000 $ 71,100 327,000 99,900 $ 498,000 Beech's managers have made the following additional assumptions and estimates: 1. Estimated sales for July, August, September, and October will be $210,000, $230,000, $220,000, and $240,000, respectively. 2. All sales are on credit and all credit sales are collected. Each month's credit sales are collected 35% in the month of sale and 65% in the month following the sale. All of the accounts receivable at June 30 will be collected in July. 3. Each month's ending inventory must equal 30% of the cost of next month's sales. The cost of goods sold is 60% of sales. The company pays for 40% of its merchandise purchases in the month of the purchase and the remaining 60% in the month following the purchase. All of the accounts payable at June 30 will be paid in July. 4. Monthly selling and administrative expenses are always $60,000. Each month $5,000 of this total amount is depreciation expense and the remaining $55,000 relates to expenses that are paid in the month they are incurred. 5. The company does not plan to borrow money or pay or declare dividends during the quarter ended September 30. The company does not plan to issue any common stock or repurchase its own stock during the quarter ended September 30. Required: 1. Prepare a schedule of expected cash collections for July, August, and September. 2-a. Prepare a merchandise purchases budget for July, August, and September. Also compute total merchandise purchases for the quarter ended September 30. 2-b. Prepare a schedule of expected cash disbursements for merchandise purchases for July, August, and September. 3. Prepare an income statement that computes net operating income for the quarter ended September 30. 4. Prepare a balance sheet as of September 30. Req 1 Reg 2A Req 2B Req 3 Req 4 Prepare a schedule of expected cash collections for July, August, and September. Schedule of Expected Cash Collections Month August September Quarter July $ 136,000 From accounts receivable $ 136,000 94,500 115,500 From July sales From August sales From September sales 210,000 230,000 103,500 126,500 99,000 99,000 Total cash collections $ 230,500 $ 219,000 $ 225,500 $ 675,000 Req 1 Req 2A Req 2B Req3 Req 4 Prepare a merchandise purchases budget for July, August, and September. Also compute total merchandis quarter ended September 30. Merchandise Purchases Budget July August September Quarter Budgeted cost of goods sold 126,000 $ 138,000 $ 132,000 $ 396,000 Add: Desired ending merchandise inventory 27,600 26,400 28,800 82,800 Total needs 153,600 164,400 160,800 478,800 Less: Beginning merchandise inventory (62,000) (27,600) (26,400) (116,000) Required purchases $ 91,600 $ 136,800 $ 134,400 $ 362,800 Prepare a schedule of expected cash disbursements for merchandise purchases for July, August, and September. Quarter Schedule of Cash Disbursements for Purchases July August September From accounts payable $ 71,100 From July purchases 27,480 64,120 From August purchases 41,040 95,760 From September purchases 40,320 Total cash disbursements $ 98,580 $ 105,160 $ 136,080 $ 71,100 91,600 136,800 40,320 $ 339,820 Prepare an income statement that computes net operating income for the quarter ended September 30. Beech Corporation Income Statement For the Quarter Ended September 30 Sales $ 660,000 Cost of goods sold (396,000)| Gross margin 264,000 Selling and administrative expenses (180,000) Net operating income 84,000 Prepare a balance sheet as of September 30. Beech Corporation Balance Sheet September 30 Assets Cash $ Accounts receivable 260,180 121,000 28,800 Inventory Plant and equipment, net 195,000 Total assets $ 604,980 Liabilities and Stockholders' Equity Accounts payable $ Common stock 94,080 327,000 183,900 Retained earnings Total liabilities and stockholders' equity $ 604,980