The following data relate to the operations of Shilow Company, a wholesale distributor of consumer goods: Current assets as of March 31: Cash Accounts receivable Inventory Building and equipment, net Accounts payable Common stock Retained earnings $ 7,400 $ 19,600 $ 39,000 $ 126,000 $ 23,175 $ 150,000 $ 18,825 a. The gross margin is 25% of sales. b. Actual and budgeted sales data: March (actual) April May June July $ 49,000 $ 65,000 $ 70,000 $ 95,000 $ 46,000 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 paid for in the month of purchase; the other half is paid for in the following month. The accounts payable at March 31 are the result of March purchases of inventory. f. Monthly expenses are as follows: commissions, 12% of sales; rent, $2,200 per month; other expenses (excluding depreciation), 6% of sales. Assume that these expenses are paid monthly. Depreciation is $945 per month (includes depreciation on new assets). g. Equipment costing $1,400 will be purchased for cash in April. h. Management would like to maintain 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. Required: 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: 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. > Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 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 Sales Cost of goods sold: Beginning inventory Ending inventory Gross margin Selling and administrative expenses: Commissions Rent Other expenses Depreciation Interest expense Net operating income Interest expense Net income 172,500 $ 230,000 172,500 172,500 57,500 27,600 6,600 13,800 2,835 210 x 51,045 6,455 < Required 3 6,455 Required 5 > Required: 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. Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Required 5 Prepare a balance sheet as of June 30. Shilow Company Balance Sheet Current assets: Cash Accounts receivable Inventory Building and equipment-net Total current assets Total assets June 30 Assets Liabilities and Stockholders' Equity $ 6,040 38,000 27,600 124,565 196,205 $ 196,205 Stockholders' equity: Accounts payable > $ 20,925 Common stock 150,000 Retained earnings 25,280 196,205 Total liabilities and stockholders' equity $196,205 < Required 4 Required 5 >