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2. (12 points) Weldon Industrial Gas Corporation supplies acetylene and other compressed gases to industry. Data regarding the store's operations follow: The company sells cach unit for S45. Budgeled Sales: Month October November December January Sales in Umils 30.000 25.000 40.000 30,000 Collections are expected to be 70% in the month of sale, 30% in the month following the sale. The AR balance at September 30th will be collected in full in October The cost of the merchandise is $3& per unit. In addition to mecting the current month's sales demand, management wants to maintain and ending inventory balance of 10% of the next month's sales The beginning inventory balance at October 1st is 3,000 units. Payment for merchandise is made as follows: paid in the month of the purchases paid the month following the purchase The AP balance at September 30th will be paid in full in October A dividend was paid in October for S500,000. Minimum cash balance is $100,000. The company has a line of credit for $500.000 at an annual interest rate of 12%. Loans are taken out on first day of month borrowed and repaidat the end of the quarter with interest. Balance Sheet September 30 $ Assets Cash... Accounts receivable.... Inventory Properly. plant and equipment (net of $200,000 accumulated depreciation)... Total assets.... 100.000 250.000 114,000 866.400 $1.330.400 Liabilities and Stockholders' Fquity Accounts payable..... $ 300.000 Common stock... 582,000 Retained carnings... 148.400 Total liabilities and stockholders' equily .... SL330 400 Required: a. Prepare a Sales Budget for October November December, and Quarter b. Prepare a Schedule of Fxpected Cash Collections for October, November, December, and Quarler. c. Prepare a Merchandise Purchases Budgel for October, November December, and Quarter d. Prepare a Schedule of Expected Cash Disbursements for October November, December, and Quarter. c. Prepare Cash Budgets for October, November December, and Quarter Sales Budget October November December Quarter Units Sold Sales Price per unit Total Sales December Quarter Schedule of Expected Cash Collections October November Beginning A/R $250,000 October Sales November Sales December Sales Total October November December Quarter Purchases Budget | Budgeted Sales (units) +Desired ending iny. = total needs Beginning inv. (3.000) =Total Purchases X cost per unit -Total purchase cost December Schedule of Expected Cash Disbursements October November Beginning A/P $300,000 October Purchases November Purchases December Purchases Total Cash Budget November December Beginning Cash bal. October $100,000 +Cash collections =Cash Available Less: Cash Disburse. For Purchases Dividend -Total cash disburse. Excess/(Deficiency) Borrowing Repayment Interest Ending Cash bal