The following data relate to the operations of Shilow company, a wholesale distributor of consumer goods: Current assets as of March 31 Cash 9,200 Accounts receivable 26,800 Inventory 49,800 Building and equipment, net 104,400 29,925 Accounts payable Capital stock 150,000 10,275 Retained earnings a. The gross margin is 25% of sales. b. Actual and budgeted sales data: $67,000 March (actual) $83.000 $88,000 $113,000 June $64,000 July c. Sales are 60% for cash and 40% on credit. Credit sales are collected in the month following sale. The accounts receivable at 31 are a result of March credit sales. cost of goods sold. d. Each month's ending inventory should 80% the following month's budgeted other half is paid for e. One-half of a month's inventory purchases is paid for in the month of purchase; the of in the following month. The accounts payable at March 31 are the result of March purchases inventory of sales; rent, $4,000 per month; other expenses Monthly expenses are as follows: commissions, 12% monthly. Depreciation is (excluding depreciation), 6% of sales. Assume that these expenses are paid $783 per month (includes depreciation on new assets) g. Equipment costing $3,200 will be purchased for cash in April. each h. would like to maintain a minimum cash balance of at least $4,000 at the end of in interest month. The company has an agreement with a local bank that allows the company to borrow The increments of $1,000 at the beginning of each month, up to a total loan balance of $20,000. 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