Use the information below to answer the two questions that follow. A company prepares its master budget for the second quarter on a monthly basis and has gathered the following budget data: 1. Budgeted sales April $500,000 May $740,000 June $860,000 2. Sales are made 70% for cash and 30% on credit. Credit sales are collected as follows: The month of sale A month after sales Uncollectible 60% 38% 2% (The company recognizes bad debt expenses in the month sales are made.) 3. Cost of goods sold for each month is 30% of sales. 4. Variable selling and administrative expenses (100% cash expenditure) are 25% of sales. 5. Fixed selling and administrative (S&A) expenses for each month are: Advertising Executive salaries Insurance Depreciation Total fixed S&A expenses 6. Inventory purchases paid for in May will be $25,000. $ 52,000 $19,000 $ 29,000 $ 28,000 $128,000 7. The company expects to borrow $50,000 on May 1. No principal will be repaid during the year, Interest at an annual rate of 12% is due monthly. 8. The company will pay dividends of $25,000 in June that was declared in May. Q. How much is the budgeted net income for May? (Ignore taxes.) ANS. $ Q. If the beginning cash balance in May is expected to be $20,000, what will be the budgeted ending balance of cash in May? ANS. $