Required: Prepare a master budget for the San Jacinto Emporium Company for the fourth quarter of 2017. The following component budgets must be included: 1. Sales Budget 2. Cost of Goods Sold, Inventory and Purchases Budget 3. Operating Expense Budget 4. Budgeted Income Statement 5. Schedule of Expected Cash Collections 6. Schedule of Expected Cash Disbursements - Merchandise Purchases 7. Schedule of Expected Cash Disbursements - Operating Expenses 8. Combined Cash Budget The San Jacinto Emporium Company is a merchandising business located in Houston, Texas. The owners understand that accurate budgeting will help obtain this goal. The company is completing its third year of operations and is preparing to build its master budget for the fourth quarter of the year. The budget will detail each months activity and the total for the quarter. The master budget will be based on the following information: 1. Sales were budgeted at $202,000 for September. Expected sales are $208,000 for October, $207,000 for November, $210,000 for December, and $204,000 for January 2018. The gross margin is 40% of sales. Sales are projected to be 80% in cash and 20% on credit. Credit sales are collected in the month following the sale. The September accounts receivable are a result of the September credit sales. There are no bad debts. 2. Each months ending inventory should equal 75% of the next months budgeted cost of goods sold. Merchandise Inventory Purchases are paid as follows; 85% of a months inventory purchases are paid for in the month of purchase; the remaining 15% is paid for in the following month. The accounts payable at September 30 are the result of September purchases of inventory. 3. Monthly operating expenses are as follows: commissions are 10% of sales; rent is $3,000 per month, other operating expenses (excluding depreciation) are 15% of sales. Assume these expenses are paid in cash each month. Deprecation is $1,500 per month. 4. November equipment purchases cost $8,000, and December equipment purchases cost $3,000. All equipment purchases are paid for in cash in the month purchased. 5. Management would like to maintain a minimum cash balance of at least $50,000 at the end of each month. The company has an agreement with a local bank that allows them to borrow in increments of $1,000 at the end of each month. The interest rate on these loans is 1% per month and for simplicity we will assume that interest is not compounded (only paying interest on the principal). They would, as far as it is able, repay the loan plus accumulated interest in the last month of the quarter. The projected balance sheet as of September 30, is as follows: Assets September 30 Cash $12,000.00 Accounts Receivable 40,400.00 Inventory 93,600.00 Plant & Equipment, net 121,750.00 Total assets $267,750.00 Liabilities & Equity Accounts Payable $18,585.00 Retained Earnings 249,165.00 Total liabilities & equity $267,750.00

**** with Excel work sheet please