Suns and Cloud, Inc. is a small wholesale distributor of consumer goods. The company generates a

gross margin shown in the blue table. The percent of cash sales is shown in the blue table; the

remainder is sold on account and is collected one month later. Accounts receivable on June $302023$

are the result of June's credit sales to be collected the next month. Budgeted sales for the period

were as follows:

As of July $1$st$,$ the company plans for each month's ending inventory to be the blue table percentage

of the following month's budgeted cost of goods sold. Inventory cash purchases are also shown in

the blue table; the rest is paid for in the following month. The accounts payable on June $30$ are the

result of June's purchases of inventory. All monthly expenses were paid monthly. Monthly expenses

included: commissions, $$8,600$; rent, $$2,000$; other expenses $($excluding prodcution equipments

depreciation$),$ are reflected in the blue able as a percent of sales. Total production equipments'

depreciation is $$1,200$ for the quarter and includes depreciation on new equipments acquired

during the quarter. The assets acquired were all cash purchases, $$3,000$ in July and $$3,400$ in August.

The company wishes to maintain a minimum cash balance of $$2,000$ at the end of each month. The

company has excellent relationship with a local credit union that allows the company to borrow in

increments of $$1,000$ at the beginning of each month, up to a total line of credit loan balance of

$$30,000.$ The interest rate on these loans is $2\mathrm{.}5\%$ per month, and interest is not compounded. The

company, when able, repays the loan plus accumulated interest at the end of the quarter.

Additional information:

Required:

Using the data above, for the $3$rd quarter ending Sept $302023,$ prepare the following

monthly & quarter in the thrid tab:

a$.$ The schedule of the expected Cash Collections

b$.$ The merchandise Purchases budget:

c$.$ The schedule of expected cash disbursements $-$ Merchandise purchases.

d$.$ The schedule of expected cash disbursement$-$Selling and Administrative expenses

e$.$ The Cash budget:

f$.$ An absorption costing Income Statement, for the quarter ending Sept $302023$

g$.$ A Balance Sheet as of Sept $302023$

$*$Provide a short write up $(2-3$ paragraphs$)$ of the cashflow situation at this company after

you completed the budgets. What are your concerns and what would you recommend to

management? What strategies?