The management of Zigby Manufacturing prepared the following estimated balance sheet for March, $2013$: $\backslash$table$[[$Liabilities and Equity$],[$Accounts payable,$206,300],[$Short$-$term notes payable,$29,000],[$Total current liabilities,$$^(235,300)],[$Long$-$term note payable,$520,000],[$Total liabilities,$755,300],[$Common stock,$352,000],[$Retained earnings,$352,780],[$Total stockholders' equity,$704,780],[$Total liabilities and equity,$$^(1,460,080)]]$

To prepare a master budget for April, May, and June of $2013,$ management gathers the following information. a$.$ Sales for March total $23,200$ units. Forecasted sales in units are as follows: April,

$23,200$; May, $17,100$; June, $21,900$; July, $23,200.$ Sales of $257,000$ units are forecasted

for the entire year. The product's selling price is $$25\mathrm{.}00$ per unit and its total product

cost is $$20\mathrm{.}50$ per unit.

b$.$ Company policy calls for a given month's ending raw materials inventory to equal $50\%$

of the next month's materials requirements. The March $31$ raw materials inventory is

$4,580$ units, which complies with the policy. The expected June $30$ ending raw

materials inventory is $5,700$ units. Raw materials cost $$20$ per unit. Each finished unit

requires $0\mathrm{.}50$ units of raw materials.

c$.$ Company policy calls for a given month's ending finished goods inventory to equal

$80\%$ of the next month's expected unit sales. The March $31$ finished goods inventory is

$18,560$ units, which complies with the policy

d$.$ Each finished unit requires $0\mathrm{.}50$ hours of direct labor at a rate of $$13$ per hour.

e$.$ Overhead is allocated based on direct labor hours. The predetermined variable

overhead rate is $$4\mathrm{.}40$ per direct labor hour. Depreciation of $$37,320$ per month is

treated as fixed factory overhead.

f$.$ Sales representatives' commissions are $5\%$ of sales and are paid in the month of the

sales. The sales manager's monthly salary is $$4,700$ per month.

g$.$ Monthly general and administrative expenses include $$29,000$ administrative salaries

and $0\mathrm{.}8\%$ monthly interest on the long$-$term note payable.

h$.$ The company expects $20\%$ of sales to be for cash and the remaining $80\%$ on credit.

Receivables are collected in full in the month following the sale $($none is collected in

the month of the sale$).$

i$.$ All raw materials purchases are on credit, and no payables arise from any other

transactions. One month's raw materials purchases are fully paid in the next month.

J$.$ The minimum ending cash balance for all months is $$99,000.$ If necessary, the

company borrows enough cash using a short$-$term note to reach the minimum. Short$-$

term notes require an interest payment of $1\%$ at each month$-$end $($before any

repayment$).$ If the ending cash balance exceeds the minimum, the excess will be

applied to repaying the short$-$term notes payable balance.

K$.$ Dividends of $$27,000$ are to be declared and paid in May.

I. No cash payments for income taxes are to be made during the second calendar

quarter. Income tax will be assessed at $40\%$ in the quarter and paid in the third

calendar quarter.

m$.$ Equipment purchases of $$147,000$ are budgeted for the last day of June. Selling expense budget.

$\backslash$table$[[$ZIGBY MANUFACTURING$],[$Selling Expense Budget,$],[,$April, May, and June $2013,,,],[$Budgeted sales,April,May,June,$],[,,,,],[$Sales commissions,,,,$],[,,,,],[,,,,]]$General and administrative expense budget.

$\backslash$table$[[\backslash$table$[[$ZIGBY MANUFACTURING$],[$Estimated Balance Sheet$],[$March $31,2013]]],[$Assets$,],[$Cash$,$$$57,000],[$Accounts receivable,$464,000],[$Raw materials inventory,$91,600],[$Finished goods inventory,$380,480],[$Total current assets,$993,080],[$Equipment$,$ gross,$634,000],[$Accumulated depreciation,$(167,000)],[$Equipment$,$ net,$467,000],[$Total assets,$\backslash$table$[[$$$^(1,460,080)]]]]$