[The following information applies to the questions displayed below.]

Near the end of 2011, the management of Simid Sports Co., a merchandising company, prepared the following estimated statement of financial position for December 31, 2011.

SIMID SPORTS COMPANY Estimated Statement of Financial position December 31, 2011
Assets
Cash				$	36,000
Accounts receivable					520,000
Inventory					105,000
Total current assets					661,000
Equipment	$	539,000
Less accumulated depreciation		67,375			471,625
Total assets				$	1,132,625
Liabilities and Equity
Accounts payable	$	375,000
Bank loan payable		15,000
Tax payable (due 3/15/2012)		91,000
Total liabilities				$	481,000
Share capitalordinary		471,000
Retained earnings		180,625
Total stockholders equity					651,625
Total liabilities and equity				$	1,132,625

To prepare a master budget for January, February, and March of 2012, management gathers the following information.

a.	Simid Sports single product is purchased for $20 per unit and resold for $55 per unit. The expected inventory level of 5,250 units on December 31, 2011, is more than managements desired level for 2012, which is 20% of the next months expected sales (in units). Expected sales are: January, 7,000 units; February, 9,000 units; March, 10,750 units; and April, 9,500 units.
b.	Cash sales and credit sales represent 20% and 80%, respectively, of total sales. Of the credit sales, 57% is collected in the first month after the month of sale and 43% in the second month after the month of sale. For the December 31, 2011, accounts receivable balance, $120,000 is collected in January and the remaining $400,000 is collected in February.
c.	Merchandise purchases are paid for as follows: 20% in the first month after the month of purchase and 80% in the second month after the month of purchase. For the December 31, 2011, accounts payable balance, $70,000 is paid in January and the remaining $305,000 is paid in February.
d.	Sales commissions equal to 20% of sales are paid each month. Sales salaries (excluding commissions) are $96,000 per year.
e.	General and administrative salaries are $132,000 per year. Maintenance expense equals $2,200 per month and is paid in cash.
f.	Equipment reported in the December 31, 2011, statement of financial position was purchased in January 2011. It is being depreciated over eight years under the straight-line method with no residual value. The following amounts for new equipment purchases are planned in the coming quarter: January, $37,000; February, $97,000; and March, $29,500. This equipment will be depreciated under the straight-line method over eight years with no residual value. A full months depreciation is taken for the month in which equipment is purchased.
g.	The company plans to acquire land at the end of March at a cost of $165,000, which will be paid with cash on the last day of the month.
h.	Simid Sports has a working arrangement with its bank to obtain additional loans as needed. The interest rate is 12% per year, and interest is paid at each month-end based on the beginning balance. Partial or full payments on these loans can be made on the last day of the month. The company has agreed to maintain a minimum ending cash balance of $12,650 in each month.
i.	The income tax rate for the company is 43%. Income tax on the first quarters income will not be paid until April 15.

Required:

Prepare a master budget for each of the first three months of 2012; include the following component budgets:

1. Monthly sales budgets. (Omit the "$" sign in your response.) SIMID SPORTS Co Sales Budget January, February, and March 2012 Budgeted Units Budgeted Unit Price Budgeted Total Dollars 55 $385000 495000 591250 7000 $ January 2012 February 2012 March 2012 9000 10750 $1471250 26750 Total for the first quarter 2 Monthly merchandise purchases budgets. (Units to be deducted should be indicated with a minus sign. Omit the "S" & '%" signs in your response.) SIMID SPORTS CO Merchandise Purchases Budget January, February, and March 2012 March January February Total Next month's budgeted sales 9000 10750 9500 20 20 20% Ratio of inventory to future sales 1800 2150 1900 Budgeted ending inventory Add: Budgeted sales 7000 9000 10750 11150 Required available merchandise 8800 12650 5250 Deduct: Beginning inventory -1800 2150 9350 23400 Units to be purchased 3550 10500 20 Budgeted cost per unit 20$ 20 $ 20 87000 21000 468000 71000 $ Budgeted merchandise purchases 3. Monthly selling expense budgets. (Omit the "S" & '%" signs in your response.) SIMID SPORTS CO Selling Expense Budget January, February, and March 2012 January February 495000 591250 March Total $385000 Budgeted sales 20 % 20 % 20% Sales commission percent $294250 118250 S 77000 Sales commissions expense 99000 Sales salaries 24000 8000 8000 8000 31 126250 $ 85000$ 107000 $ Total selling expenses 4. Monthly general and administrative expense budgets. (Do not round your intermediate calculations. Round your final answers to the nearest whole dollar. Omit the "$" sign in your response.) SIMID SPORTS CO. General and Administrative Expense Budget January, February, and March 2012 February Total January March 11000 11000 $ 11000 $ 2200 7318 33000 6600 20328 Salaries 2200 Maintenance 2200 6000 Depreciation 7010 20210$ 19200 $ 20518$ Total expenses 59928 5. Monthly capital expenditures budgets. (Leave no cells blank - be certain to enter "O" wherever required. Input all amounts as positive values. Omit the "$" sign in your response.) SIMID SPORTS CO. Capital Expenditures Budget January, February, and March 2012 January February March 29500 165000 Equipment purchases 37000 $ 97000 $ Land purchase 0 0 $ 37000 97000 194500 Total 6. Monthly cash budgets. (Leave no cells blank - be certain to enter "O" wherever required. Input all amounts as positive values except negative preliminary cash balance and repayment of loan to bank which should be indicated by a minus sign. Round your intermediate calculations and final answers to the nearest dollar amount. Omit the "$" sign in your response.) SIMID SPORTS CO Cash Budget January, February, and March 2012 February January March Beginning cash balance 36000 $ Cash receipts from customers Total cash available Cash disbursements Payments for merchandise Sales commissions Sales salaries General & administrative salaries Maintenance expense Interest Tax payable Purchases of equipment Purchase of land Total cash disbursements Preliminary cash balance Repayment of loan to bank Ending cash balance Loan balance, end of month 7. Budgeted income statement for the entire first quarter (not for each month). (Round your answers to the nearest dollar amount. Input all amounts as positive values. Omit the "$" sign in your response.) SIMID SPORTS CO Budgeted Income Statement For Three Months Ended March 31, 2012 (Click to select) (Click to select) (Click to select) Operating expenses (Click to select) (Click to select) (Click to select) (Click to select) (Click to select) (Click to select) (Click to select) (Click to select) (Click to select) 8. Budgeted statement of financial position as at March 31, 2012. (Be sure to list the assets in order of their liquidity. Round your answers to the nearest dollar amount. Leave no cells blank - be certain to enter "o" wherever required. Input all amounts as positive values. Round your intermediate calculations and final answers to the nearest dollar amount. Omit the "$" sign in your response.) SIMID SPORTS CO Budgeted Statement of Financial Position March 31, 2012 Assets (Click to select) (Click to select) (Click to select) Total Current Assets (Click to select) (Click to select) (Click to select) Total Assets Liabilities and Equity (Click to select) (Click to select) (Click to select) Total Liabilities (Click to select) Click to select) Total Stockholders' Equity Total Liabilities & Equity