The following data relate to the second quarter operations of Leisure Sports, a wholesale distributor of consumer sporting goods, as of March 31: C as h $ 9 ,. 0 0 0 Accounts receivable :1 B , 00 0 Inventory 12 , 60 0 Building and equ ipment , not 214 , 10 0 Ace aunts payable 1 B , 30 0 Common shares 190,000 Retained earnings T5,!00 a. Actual sales for March and budgeted sales for April through July are as follows: March (actual) $60,000 April 7 0 ,000 May 35,0110 June 9 0 .000 July 50.00:: b. Sales are 20% cash and 80% credit. Credit sales are collected in the month following sale. The accounts receivable at March 31 are a result of March credit sales. c. The company's gross margin is 40% of sales. d. Monthly expenses are as follows: salaries and wages $75,500 per month; shipping. 6% of sales; advertising, $6,000 per month: other expenses, 4% of sales. Depreciation, including depreciation on new assets acquired during the quarter, will be $5,000 in total for the quarter. e. Each month's ending inventory should equal 30% of the following month's cost of goods sold. f. 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. 9. Equipment costing $11,500 will be purchased for cash in April and $3,000 will be purchased for cash in May. h. Dividends of$3,500 will be declared and paid in June. i. The company must maintain a minimum cash balance of $8,000. An open line of credit is available ata local bank. All borrowing is done atthe beginning of a month, and all repayments are made at the end of a month. The monthly interest rate is 1%. Interest must be paid at the end of each month based on the total loans outstanding for that month. Required: Using the data above, complete the following: 1-a. Sales budget Total sales 15 T0000 Cash 12.000 '14 .000 Credit $ 48,000 $ 55.000 1-b. Schedule of expected cash collections: Cash sales Credit sales Total collections $ 62.000 2-a. Merchandise purchases budget: April May June Quarter Budgeted cost of goods sold* $ 42,000 $ 51,000 Add desired ending inventoryt 15,300 Total needs $ 57,300 Less beginning inventory 12,600 Required purchases $ 44,700 "For April sales: $70,000 sales x 60% cost ratio +At April 30: $51,000 * 30% At June 30: July sales $50,000 x 60% cost ratio x 30% 2-b. Schedule of expected cash disbursements-Merchandise purchases: April May June Quarter March purchases $ 18,300 April purchases 22,350 22,350 May purchases June purchases Total disbursements $ 40,650 3. Schedule of expected cash disbursements-Selling and administrative expenses: April May June Quarter Salaries and wages $ 7,500 Shipping 4,200 Advertising 6,000 Other 2,800 Total disbursements $ 20,5004. Cash budget (Round your intermediate calculations and final answers to the nearest whole dollar. Also, round up your interest calculations to the next whole dollar amount. Cash deficiency. repayments and interest should be indicated by a minus sign.) Cash balance. beginning 9.000 Add cash collections 62.000 Total cash available ?1.000 Less cash disbursements: For inventory purchases 40.650 For selling and administrative expenses 20.500 For equipment purchases 11.500 For dividend paymenls 0 Total cash disbursements 72.650 Excess (deciency) of cash (1,650) Financing: Borrowings Repayments Interest Total nancing Cash balance. ending 5. Prepare an absorption costing income statement for the quarter ended June 30. Cost of goods sold: Less Operating expenses: 6. Prepare a balance sheet as of June 30. LEISURE SPORTS Balance Sheet June 30 Assets Current assets: Total current assets Total assets Liabilities and Stockholders' Equity Stockholders' equity: Total liabilities and stockholders' equity