You are the Business Manager of Garden Sales, Inc and the bank has asked you to prepare a cash and earnings budget forecast and Pro-Forma Balance Sheet and Income Statement for the next quarter. After your discussion with the various departments, you have come up with the following information/assumptions: - November 2017 and December 2017 sales were $120,000, each month - Sales for the following three months will decrease by $1,500 each month, beginning January through April. - Cost of Sales represents 75% of sales, each month. - Cash Operating Expenses are 15\% of sales, exclusive of Depreciation expense - Depreciation Expense is $3,000, per month and prepaid rent is amortized at $1,000 per month - Of the month's sales, 10% is collected as cash with the remaining placed on customer's account. - Customer's accounts are usually paid off over a 2 month period (50ss each month) beginning the month following the sale - The CFO just informed you that one customer has filed bankruptcy therefore, $2,000 from Nov A/R Sales will be written off in Jan to Bad Debt Exp. - To maintain sufficient inventory, the company purchases 100% of the next month's cost of sales. They pay for 70 os, in cash, in the month they purchase and pay the remaining 30% in the following month. - In March, the company is planning on replacing an outdated machine. The new machine will cost $30,000. The old machine originally cost $21,000 with a Net Book Value of 7,000 and will be sold for $5,000 - The Company does not pay or accrue for taxes until the end of December. - The Company plans to pay a cash dividend of $3,000 at the end of March. - Assume all operating expenses incurred during the month are paid, in cash, during the same month incurred - The Note Payable requires a principal payment of $6,000, plus interest of $250, at the end of March. For this note, no interest is Accrued/Expensed until interest is paid - The minimum cash month end balance required according to the bank agreement is $75,000 for any given month beginning Jan30,2018. - A working capital line of credit is available, up to $25,000, and if needed, money is taken out at the beginning of the month. Interest is 1%% per month. - Interest is paid on the working capital line when principal payments are paid on the debt; at the end of any given month. - Interest is accrued on the working capital line effective the beginning of the month when money is received. 1. Prepare a detailed Cash Budget/Forecast for each month of Jan, Feb and March, 2018 2. Prepare an Income Statement for each period Jan-Mar 2018 (in good form) 3. Prepare a Balance Sheet as of March 31, 2018 (in good form) 4. Although you may use Excel, this assignment must be tumed in as a HAND-WRITTEN document. This sheet must be turned in Check Figures for 03/31 with your assignment. No Retained Earnings: $851,839.79 exceptions. Total Assets: $1,140,100,00