The Gerard Tire Company manufactures racing tires for bicycles. Gerard sells tires for $90 each. Gerard is planning for the next year by developing a master budget by quarters. Gerard's balance sheet for December 31, 2018, follows:

Other Data for the Gerard Tire Company: A. Budgeted sales are 1,500 tires for the first quarter and expected to increase by 200 tires per quarter. Cash sales are expected to be 10% of total sales, with the remaining 90% of sales on account. B. Finished goods inventory on December 31, 2018, consists of 300 tires at $33 each. C. Desired ending Finished Goods inventory is 30% of the next quarter's sales; first quarter sales for 2020 are expected to be 2,300 tires. FIFO inventory costing method is used. D. Raw materials inventory on December 31, 2018, consists of 600 pounds of rubber compound used to manufacture the tires. E. Direct materials requirements are 2 pounds of a rubber compound per tire. the cost of the compound is $8.50 per pound. F. Desired ending Raw materials Inventory is 40% of the next quarter's direct materials needed for production; desired ending inventory for December 31, 2019, is 600 pounds; indirect materials are insignificant and not considered for budgeting purposes.

G. each tire requires 0.4 hours of direct labor; direct labor costs average $12 per hour. H. Variable manufacturing overhead is $4 per tire. I. Fixed manufacturing overhead includes $6,000 per quarter in depreciation and $16,770 per quarter for other costs, such as utilities, insurance, and property taxes. J. Fixed selling and administrative expenses include $12,500 per quater for salaries; $3,000 per quater for rent; $450 per quater for insurance; and $2,000 per quater for depreciation.

K. Variable selling and administrative expenses include supplies at 2% of sales. l. Capital expenditures include $15,000 of new manufacturing equipment, to be purchased and paid in the first quarter M. Cash receipts for sales on account are 70% in the quarter of the sale and 30% in the quarter following the sale; December 31, 2018, Accounts Receivable is received in the first quarter of 2019; uncollectible accounts are considered insignificant and not considered for budgeting purposes. N. Direct materials purchase are paid 60% in the quarter purchased and 40% in the following quarter; December 31, 2018, Accounts payable is paid in the first quarter of 2019 O. Direct labor, manufacturing overhead, and selling and administrative costs are paid in the quarter incurred. P. Income tax expense is projected at $1,500 per quarter and is paid in the quarter incurred Q. Gerard desires to maintain a min. cash balance of $55,000 and borrows from the local bank as needed in increments of $1,000 at the beginning of the quarter; principal repayments are made at the beginning of the quarter when excess funds are available and in increments of $1,000: interest is 6% per year and paid at the beginning of the quarter based on the amount outstanding from the previous quarter.

Requirements: 1. Prepare Gerard's operating budget and cash budget for 2019 by quarter. Required schedules and budgets include: sales budget, production budget, and cash budget, direct materials budget, direct labor budget, manufacturing overhead budget, cost of goods sold budget, selling and admin. expense budget, schedule of cash receipts, Schedule of cash payments and cash budget. MAnufacturing overhead costs are allocated based on direct labor hours. Round all calculations to the nearest dollar 2, Prepare Gerard's annual financial budget for 2019, including budgeted income statement and budgeted balance sheet.

I would appreciate if formulas used to get answers were shown

GERARD TIRE COMPANY Balance Sheet December 31, 2018 Assets Current Assets: 56,000 20,000 5,100 9,900 Cash Accounts Receivable Ravw Materials Inventory Finished Goods Inventory Total Current Assett 91,000 Property, Plant, and Equipment 94,000 Equipment (42,000152,000 5 243,000 Total Assets Liabilities Current Liabilities: 8,000 Accounts Payablo Stockholders' Equity Common Stock, no par Retained Earnings 120,000 115,000 235,000 $ 243,000 Total Stockholders' Equity Total Liabilities and Stockholders' Equity