Walker Company prepares monthly budgets. The current budget plans for a September ending merchandise inventory of 19,000 units. Company policy is to end each month with merchandise inventory equal to 10% of budgeted sales for the following month. Budgeted sales and merchandise purchases for the next three months follow. The company budgets sales of190,000 units in October. Sales (Units) Purchases (Units) July 210,000 221,000 August 320,000 319,000 September 310, 000 298,000 Prepare the merchandise purchases budgets for the months of July, August, and September. Budgeted ending inventory units = udgeted units sales for month Required units of available inventory 'eginning inventory (units) Units to be purchased 221,000 319,000 298,000 a. Beginning cash balance, September 1, $48,000. b. Budgeted cash receipts from sales in September, $259,000. c. Raw materials are purchased on account. Purchase amounts are August (actual), $71,000, and September (budgeted), $109,000. Payments for direct materials are made as follows: 70% in the month of purchase and 30% in the month following purchase. d. Budgeted cash payments for direct labor in September, $37,000. e. Budgeted depreciation expense for September, $4,000. f. Other cash expenses budgeted for September, $53,000. 9. Accrued income taxes payable in September, $10,800. h. Bank loan interest payable in September, $1,300. 9 Answer is not complete. $ 48,000 9 Cash receipts from sales 259,000 0 Beginning cash balance $ Total cash available 307,000 Cash payments for: Direct materials Direct labor 37,000 0 Other expenses 53,000 a Accrued taxes Interest on bank loan 102,100 $ 204,900 Total cash payments Ending cash balance