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 Huilding and equipment, net Accounts payable Common stock Retained earnings $ 7,200 $18,300 $ 37,800 $ 123,600 $ 22,425 $150,000 $ 14,975 a. The gross margin is 25% of sales b. Actual and budgeted sales data: March (actual) May June July $ 47,000 $63.000 $ 68,000 593,000 $44.000 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 monty's budgeted cost of goods sold. e One halt 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 1. Monthly expenses are as follows commissions, 12% of sales, rent. $2,000 per month other expenses (excluding depreciation), 6% PUMPUR accounts payable at March 31 are the result of March purchases of inventory 1. Monthly expenses are as follows: commissions, 12% of sales, rent, $2,000 per month other expenses (excluding depreciation), 6% of sales. Assume that these expenses are paid monthly Depreciation is $927 per month (includes depreciation on new assets) g. Equipment costing $1,200 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. 01 Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Required 5 Complete the schedule of expected cash collections. Quarter Schedule of Expected Cash Collections April May June Cash sales $ 37,800 Credit sales 18,800 Total collections $ 56,600 $ 0 $ 0 S 0 CARA Required 2 > Merchandise Purchases Budget April May June Quarter Budgeted cost of goods sold $ 47,250 $51,000 Add desired ending merchandise inventory 40,800 Total needs 88,050 51,000 Less beginning merchandise inventory 37,800 Required purchases $ 50,250 $51,000 $ 0 $ 0 Budgeted cost of goods sold for April = $63,000 sales x 75% = $47 250 Add desired ending inventory for April = $51,000 ~ 80% = $40,800 Schedule of Expected Cash Disbursements--Merchandise Purchases April May June Quarter March purchases $ 22,425 $ 22,425 April purchases 25,125 25,125 50,250 May purchases June purchases Total disbursements $ 47,550 $25 125 $ 0 $ 72,675 Shilow Company Cash Budget April May $ 7,200 June Quarter Beginning cash balance Add collections from customers 56,600 Total cash available 63,800 0 0 0 Less cash disbursements 47,550 13,340 1,200 62,090 0 0 0 1,710 0 0 0 For inventory For expenses For equipment Total cash disbursements Excess (deficiency) of cash available over disbursements Financing Borrowings Repayments Interest Total financing Ending cash balance 0 0 0 0 $ 1,710 $ 0 $ 0 $ 0 Shilow Company Income Statement For the Quarter Ended June 30 Cost of goods sold 0 0 0 Selling and administrative expenses. 0 0 0 Prepare a balance sheet as of June 30. Shilow Company Balance Sheet June 30 Assets Current assets Total current assets 0 Total assets $ 0 Liabilities and Stockholders' Equity Stockholders' equity 0 Total liabilities and stockholders' equity $ 0