Required information The following information applies to the questions displayed below.] The management of Zigby Manufacturing prepared the following estimated balance sheet for March, 2013: ZIGBY MANUFACTURING Estimated Balance Sheet March 31, 2013 Assets Cash Accounts receivable Raw materials inventory Finished goods inventory $50,000 434,240 84,210 368,000 Total current assets Equipment, gross Accumulated depreciation 936,450 602,000 (151,000) 451,000 t 1,387,450 Equipment, net Total assets Liabilities and Equity 196,610 12,000 Accounts payable Short-term notes payable 208,610 Total current liabilities 505,000 Long-term note payable 713,610 336,000 337,840 Total liabilities Common stock Retained earnings Total stockholders' equity 673,840 1,387,450 Total liabilities and equity To prepare a master budget for April, May, and June of 2013, management gathers the following information a. Sales for March total 23,000 units. Forecasted sales in units are as follows: April, 23,000; May, 15,300; June, 20,400; July, 23,000. Sales of 241,000 units are forecasted for the entire year. The product's selling price is $23.60 per unit and its total product cost is $20.00 per unit. b. Company policy calls for a given month's ending raw materials inventory to equal 50% of the next month's materials requirements. The March 31 raw materials inventory is 4,210 units, which complies with the policy. The expected June 30 ending raw materials inventory is 4,100 units. Raw materials cost $20 per unit. Each finished unit requires 0.50 units of raw materials c. Company policy calls for a given month's ending finished goods inventory to equal 80% of the next month's expected unit sales. The March 31 finished goods inventory is 18,400 units, which complies with the policy d. Each finished unit requires O.50 hours of direct labor at a rate of $15 per hour. e. Overhead is allocated based on direct labor hours. The predetermined variable overhead rate is $2.80 per direct labor hour. Depreciation of $21,520 per month is treated as fixed factory overhead sales. The sales manager's monthly salary is $3,100 per month and 0.5% monthly interest on the long-term note payable. f. Sales representatives' commissions are 10% of sales and are paid in the month of the g. Monthly general and administrative expenses include $13,000 administrative salaries h. The company expects 20% of sales to be for cash and the remaining 80% on credit. Receivables are collected in full in the month following the sale (none is collected in the month of the sale) i. All raw materials purchases are on credit, and no payables arise from any other transactions. One month's raw materials purchases are fully paid in the next month J. The minimum ending cash balance for all months is $41,000. If necessary, the company borrows enough cash using a short-term note to reach the minimum. Short- term notes require an interest payment of 1% at each month-end (before any repayment). If the ending cash balance exceeds the minimum, the excess will be applied to repaying the short-term notes payable balance K. Dividends of $11,000 are to be declared and paid in May I. No cash payments for income taxes are to be made during the second calendar quarter. Income tax will be assessed at 40% in the quarter and paid in the third calendar quarter. m.Equipment purchases of $131,000 are budgeted for the last day of June Required: Prepare the following budgets and other financial information as required. All budgets and other financial information should be prepared for the second calendar quarter, except as otherwise noted below. Round calculations up to the nearest whole dollar, except for the amount of cash sales, which should be rounded down to the nearest whole dollar: Answer is complete but not entirely correct. ZIGBY MANUFACTURING Selling Expense Budget April, May, and June 2013 April $ 23,000 Total May June 15,300 X20,400 10% 1,530 2,040 3,100 Budgeted sales Sales commission percent Sales commissions Sales salaries Total selling expenses 10% O $ 2,3001 10% 5,870 9,300 5,140 15,170 3,100 3,100 $ 5,400 4,60