The following trial balance was drawn from the records of Fanning Company as of October 1, year 2. Cash $ 18,500 Accounts receivable 65,000 Inventory 42,500 Store equipment 250,000 Accumulated depreciation $ 77,800 Accounts payable 74,500 Line of credit loan 150,000 Common stock 55,000 Retained earnings 18,700 Totals $ 376,000 $ 376,000 Required a-1. Based on the following information, prepare a sales budget

The follawing trial bolance was drawn from the records of Fanning Company sa of October 1, year 2 Required a-1. Bssed on the follawing Informston, prepore sales budget and s schedule of cssh recelpts for October, Navember, snd December Soles for Octaber sre expected to be $205,000, conslating of $45,000 in cash and $1/60,000 on credit. The compsny expects sales to Increase st the rate of 20 percent per month. All sccounts recelvable sre collected In the month following the sole. a-2 Based on the following information, prepore a purchsses budget and a schedule of cash poyments for linventory purcheses for October, November, and December. The imentory bolance ss of October 1 was \$42,500. Cost of goods sold for October ls expected to be $74,500. Cost of goods sold lis expected to increase by 20 percent per month. The company expects to maintsin a minimum ending inventory equsl to 30 percent of the current month coat of goods sold. Seventy-five percent of accounts paysble ls poid in the month that the purchose occurs; the remaining 25 percent is poid in the following month. a-3. Bosed on the following seling and adminlatrotive expenses budgeted for October, prepore a selling and administrative expences budget for October, November, and December. Cosh poyments for ssles commisslons and utilities are made in the month following the one in which the expense is incurred. Supplies and other operating expenses are poid in cosh in the month In which they are incurred. b. Supply the misaing Information in the following pro forms Income statement snd bslance sheet for the fourth quarter of yesr 2 The statements are prepsred as of December 31 , year 2 c. Indicate whether Fann'ng will need to borrow money cluring October by preparing October's Cssh Budiget. Complete this question by entering your answers in the tabs below. Based on the following information, prepare a soles budget and a schedule of cash recelpts for Dctaber, November, and December. Sales for Odtober are expected to be \$205,000, concikting af \$45,000 in cach and \$160,000 an credt. The compony expects sales to increase at the rate of 20 percent per month. All accounts recelvable are collected in the month following the sale