The management of Zigby Manufacturing prepared the following balance sheet for March 31. ZIGBY MANUFACTURING Balance Sheet March 31 Assets Liabilities and Equity Cash $ 42,000 Liabilities Accounts receivable. 378,560 Accounts payable Raw materials inventory 107,200 Loan payable $ 211,300 14,000 Finished goods inventory 349,440 Long-tern note payable 500,000 $ 725,300 Equipment Less: Accumulated depreciation $ 604,000 152,000 Equity 452,000 Common stock 337,000 Retained earnings 266,900 603,900 Total assets $ 1,329,200 Total liabilities and equity $ 1,329,200 To prepare a master budget for April, May, and June, management gathers the following information. a. Sales for March total 20,800 units. Budgeted sales in units follow: April, 20,800; May, 21,600; June, 20,900; and July, 20,800. The product's selling price is $26.00 per unit and its total product cost is $21.00 per unit. b. Raw materials inventory consists solely of direct materials that cost $20 per pound. Company policy calls for a given month's ending materials inventory to equal 50% of the next month's direct materials requirements. The March 31 raw materials inventory is 5,360 pounds. The budgeted June 30 ending raw materials inventory is 4,200 pounds. Each finished unit requires 0.50 pound of direct materials. c. Company policy calls for a given month's ending finished goods inventory to equal 80% of the next month's budgeted unit sales. The March 31 finished goods inventory is 16,640 units. d. Each finished unit requires 0.50 hour of direct labor at a rate of $17 per hour. e. The predetermined variable overhead rate is $3.00 per direct labor hour. Depreciation of $21,100 per month is the only fixed factory overhead item. f. Sales commissions of 8% of sales are paid in the month of the sales. The sales manager's monthly salary is $3,200. g. Monthly general and administrative expenses include $14,000 for administrative salaries and 0.7% monthly interest on the long-term note payable. h. The company budgets 30% of sales to be for cash and the remaining 70% on credit. Credit sales are collected in full in the month following the sale (no credit sales are collected in the month of sale). 1. All raw materials purchases are on credit, and accounts payable are solely tied to raw materials purchases. Raw materials purchases are fully paid in the next month (none are paid in the month of purchase). J. The minimum ending cash balance for all months is $42,000. If necessary, the company borrows enough cash using a loan to reach