The following data relate to the operations of Shilow Company, a wholesale distributor of consumer goods:

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The following data relate to the operations of Shilow Company, a wholesale distrlbutor of consumer goods: Current assets as of March 31: Cash $7,380 $19,200 $38,480 $124,800 $22,800 $15e,68e $16,980 Accounts receivable Inventory Building and equipment, net Accounts payable Common stock Retained earnings a. The gross margin is 25% of sales. b. Actual and budgeted sales data March (actual) April May June July $ 48,e0e $ 64,9ee $ 69,9ee $ 94,9ee $ 45,9ee C. Sales are 60% for cash and 40% on credit. Credit sales are collected in the month following sale. The accounts receivable at March 31 are a result of March credit sales. d. Each month's ending inventory should equal 80% of the following month's budgeted cost of goods sold. e. One-half of a month's Inventory purchases is pald for In the month of purchase; the other half is pald for In the following month. The accounts payable at March 31 are the result of March purchases of Inventory. Monthly expenses are as follows: commissions, 12% of sales; rent, $2100 per month; other expenses (excluding depreciation), 6% of sales. Assume that these expenses are pald monthly. Depreclation is $936 per month (Includes depreclation on new assets). g. Equlpment costing $1,300 will be purchased for cash In April. h. Management would like to malntaln a minimum cash balance of at least $4,000 at the end of each month. 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 $20,000. 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 Requlrec Using the preceding data: 1. Complete the schedule of expected cash collections. 2 Complete the merchandise purchases budget and the schedule of expected cash disbursements for merchandise purchases. 3. Complete the cash budget. 4. Prepare an absorption costing Income statement for the quarter ended June 30 5. Prepare a balance sheet as of June 30. Required 1Required 2Required 3 Required 4 Required 5 Complete the merchandise purchases budget and the schedule of expected cash disbursements for merchandise purchases Merchandise Purchases Budget April 48,00051.750 May Quarter Budgeted cost of goods sold Add desired ending merchandise inventory Total needs Less beginning merchandise i Required purchases Budgeted cost of goods sold for April-$64,000 sales x 75%-$48,000 Add desired ending inventory for April $51,750 80% $41.400 41,400 39.400 33.400 nventory Schedule of Expected Cash Disbursements-Merchandise Purchases April 522,800 May June Quarter March purchases April purchases May purchases June purchases Total disbursements 5 22,800 25,500 25,500 51,000 Required 1 Required3 > Required 1Required 2Required 3 Required 4 Required 5 Complete the cash budget. (Cash deficiency, repayments and interest should be indicated by a minus sign.) Shilow Company Cash Budget April May Quarter 5 7.300 57,600 64.900 Beginning cash balance Add collections from customers Total cash avsilable Less cash disbursements For inventory 43.300 13.820 1.300 63,220 1,680 For expenses For equipment Total cash disbursements Excess (deficiency) of cash svaila ble over disbursements Financing Borrowings Repayments Interest Total financing Ending cash balance Required 1Required 2Required 3 Required 4 Required 5 Prepare an absorption costing income statement for the quarter ended June 30 Shilow Company Income Statement For the Quarter Ended June 30 Shilow Company Income Statement For the Quarter Ended June 30 Cost of goods sold: Cost of goods sold: Beginning inventory Ending inventory Goods available for sale Purchases Selling and administrative expenses Required 1Required 2Required 3 Required 4 Required 5 Prepare an absorption costing income statement for the quarter ended June 30 Shilow Company Income Statement For the Quarter Ended June 30 Shilow Company Income Statement For the Quarter Ended June 30 Cost of goods sold: Cost of goods sold: Selling and administrative expenses: Selling and administrative expenses Accounts payable Accounts receivable Buildings and equipment, net Cash Commissions Common stock Cost of goods sold Depreciation Interest expense Note payable Other expenses Prepaid insurance Rent Sales Prepare a balance sheet as of June 30 Shilow Company Balance Sheet June 30 Assets Shilow Company Balance Sheet June 30 Assets Current assets: Current assets: Accounts payable Accounts receivable Building and equipment-net Cash Common stock Cost of goods sold Interest expense Inventory Note payable Prepaid insurance Retained earning:s Total current sssets Total assets Equity Liabilities and Stockholders' Equity Stockholders' equity Total liabilities and stockholders' equity Total liabilities and stockholders' equity Shilow Company Balance Sheet June 30 Assets Shilow Company Balance Sheet June 30 Assets Current assets: Current assets Total current sssets Total current sssets Total assets Equity Liabilities and Stockholders' Equity Accounts payable Accounts receivable Building and equipment-net Cash Common stock Cost of goods sold Interest expense Inventory Note payable Prepaid insurance Retained earning:s Stockholders' equity Total liabilities and stockholders' equity Shilow Company Balance Sheet June 30 Assets Shilow Company Balance Sheet June 30 Assets Current assets: Current assets: Total current sssets Total current sssets Total assets Total assets Liabilities and Stockholders' Equity Liabilities and Stockholders' Equity Stockholders' equity Stockholders' equity Accounts payable Accounts receivab Building and equipment-net Cash Common stock Cost of goods sold Interest expense Inventory Note payable Prepaid insurance Retained earnings Total liabilities and stockholders' equity le