The management of Zigby Manufacturing prepared the following estimated balance sheet for March 2017: ZIGBY MANUFACTURING Estimated Balance Sheet March 31, 2017 Assets $ 50,000 434,240 84,210 Cash Accounts receivable Raw materials inventory Finished goods inventory Total current assets Equipment, gross Accumulated depreciation Equipment, net Total assets 368,000 936,450 602,000 (151,000) 451,000 $1,387,450 Liabilities and Equity Accounts payable Short-term notes payable Total current liabilities Long-term note payable Total liabilities Common stock Retained earnings Total stockholders equity Total liabilities and $1,387,450 $ 196,610 12,000 208,610 505,000 713,610 336,000 337,840 673,840 To prepare a master budget for April, May, and June of 2017, management gathers the following information: a. Sales for March total 23,000 units. Forecasted sales in units are as follows: April, 23,000; May, 15,300; June, 20,400; and July, 23,000. Sales of 241,000 units are forecasted for the entire year. The product's selling price is $23.60 per unit and its total product cost is $20.00 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 4,210 units, which complies with the policy. The expected June 30 ending raw materials inventory is 4,100 units. Raw materials cost $20 per unit. Each finished unit requires 0.50 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 18,400 units, which complies with the policy. labor hour. Depreciation of $21,520 per month is treated as fixed factory overhead. monthly salary is $3,100. the long-term note payable in the month following the sale (none are collected in the month of the sale) materials purchases are fully paid in the next month. d. Each finished unit requires 0.50 hours of direct labor at a rate of $15 per hour e. Overhead is allocated based on direct labor hours. The predetermined variable overhead rate is $2.80 per direct f. Sales representatives' commissions are 10% of sales and are paid in the month of the sales. The sales manager's g. Monthly general and administrative expenses include $13,000 administrative salaries and 0.5% monthly interest on h. The company expects 20% of sales to be for cash and the remaining 80% on credit. Receivables are collected in full . All raw materials purchases are on credit, and no payables arise from any other transactions. One month's raw j. The minimum ending cash balance for all months is $41,000. 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 $11,000 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 $131,000 are budgeted for the last day of June