The results of operations for the Preston Manufacturing Company for the fourth quarter of 2014 were as follows: Sales $550,000 Less variable cost of sales 330,000 Contribution margin 220,000 less fixed production cost $120,000 less fixed selling and administration expenses 55,000 175,000 Income before taxes 45,000 Less taxes on income 18,000 Net income $27,000 Note: Preston Manufacturing uses the variable costing method. Thus, only variable production coat are included in inventory and cost of goods sold. Fixed production cost are charged to expense in the period incurred. The company's balance sheet as of the end of the fourth quarter of 2014 was as follows: Assets: cash $160,000 Accounts receivable 220,000 Inventory 385,000 total current assets 765,000 property, plant, and equipment 440,000 less accumulated depreciation 110,000 total assets $1,095,000 Liabilities and owners equity: Accounts payable $56,000 Common stock 550,000 retained earnings 489,000 Total liabilities and owners equity $1,095,000 Addition information: 1. Sales and variable cost of sales are expected to increase by 12% in the next quarter. 2. All sales on credit with 60% collected in the quarter of sale and 40% collected in the following quarter. 3. Variable cost of sales consist of 40% materials, 40% direct labor, and 20% variable overhead. Materials are purchased on credit. 50% are paid for in the quarter of purchase, and the remaining amount is paid for in the quarter after purchase. The inventory balance is not expected to change. Also, direct labor and variable overhead cost are paid in the quarter the expenses are incurred. 4. Fixed production cost (other than $9,000 of depreciation expense) are expected to increase by 3%. Fixed production cost requiring payment are paid in the quarter they are incurred. 5. Fixed selling and administrative cost (other than $7,000 of depreciation expense) are expected to increase by 2%. Fixed selling and administrative cost requiring payment are paid in the quarter they are incurred. 6. The tax rate is expected to be 40%. All taxes are paid in the quarter they are incurred. 7. No purchases of property, plant, or equipment are expected in the first quarter of 2015. Question a) prepare a budgeted income statement for the first quarter of 2015. question b) prepare a cash budget for the first quarter of 2015. question c) prepare a budgeted balance sheet as of the end of the first quarter of 2015