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See image for question. Looking for answer for 2 b and 3 a . Budgeted monthly absorption costing income statements for April - July are:

See image for question. Looking for answer for 2b and 3
a. Budgeted monthly absorption costing income statements for April-July are:
*Includes $21,000 of depreciation each month.
b. Sales are 20% for cash and 80% on account.
c. Sales on account are collected over a three-month period with 10% collected in the month of sale; 70% collected in the first month
following the month of sale; and the remaining 20% collected in the second month following the month of sale. February's sales
totaled $195,000, and March's sales totaled $240,000.
d. Inventory purchases are paid for within 15 days. Therefore, 50% of a month's inventory purchases are paid for in the month of
purchase. The remaining 50% is paid in the following month. Accounts payable at March 31 for inventory purchases during March
total $107,800.
e. Each month's ending inventory must equal 20% of the cost of the merchandise to be sold in the following month. The merchandise
inventory at March 31 is $81,200.
f. Dividends of $28,000 will be declared and paid in April.
g. Land costing $36,000 will be purchased for cash in May.
h. The cash balance at March 31 is $50,000; the company must maintain a cash balance of at least $40,000 at the end of each month.
i. The company has an agreement with a local bank that allows the company to borrow in increments of $1,000 at the beginning of
each month, up to a total loan balance of $200,000. The interest rate on these loans is 1% per month and for simplicity we will
assume that interest is not compounded. The company would, as far as it is able, repay the loan plus accumulated interest at the
end of the quarter.
Required:
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