une The purpose of this problem is to demonstrate some of the inter income statement for the month. (Assume dollar amounts are stated state dollar amounts in this manner.) demonstrate some of the interrelationships in the budgeting e sheet at January 1, along with a simple budgeted 1. (Assume dollar amounts are stated in thousands; you also may NUTSHELL BALANCE SHEET JANUARY 1 NUTSHELL BUDGETED INCOME STATEMENT FOR JANUARY Assets $100 $ 40 Cash. . . . . . . . . .. Accounts receivable..... Inventory ....... Total ...... Liabilities & Equity Accounts payable. ...... $ 30 Owners' equity . . . . . ... 180 $210 120 50 Sales . . . . . . . . . . . . Cost of goods sold ........... Gross profit ....... Expenses ......... Net income....... $210 Total 25 $ 15 As Nutshell has no plant assets, there is no depreciation expense. Prepare a cash budget for January and a budgeted balance sheet as of January 31. These budgets are to reflect your own assumptions as to the amounts of cash and credit cald bles purchases of inventory, and payments to suppliers. We require only that collections of receivables, purchases of inventory, and payments to sunn ary 31. that receivables and inventory change from the January 1 the cash balance be $50 at January 31, that receivables and inventory s "financing" or "investing" activities (as these terms are levels, and that the company engage in no "financing" or "investing" activitie used in a statement of cash flows). ns as part of your solution, and be prepared to explain in class how Clearly state your assumptions as part of your solution, and they result in the amounts shown in your budgets. gol difficulties attributed to declining sales of its main