Question 7Not completePoints out of 1.000qaid=1994746&Question text1Developing a Master Budgetfor a Merchandising OrganizationPeyton Department Store prepares budgets quarterly. The following information is availablefor use in planning the second quarter budgets for 2010.PEYTON DEPARTMENT STOREBalance SheetMarch 31, 2010Liabilities andStockholders’ EquityAssetsCash$2,00Accounts payable0$26,000Accountsreceivable25,00Dividends payable017,000Inventory30,00Rent payable01,000PrepaidInsurance2,000 Stockholders’ equity40,000Fixtures25,000Total assets$84,0 Total liabilities and00equity$84,000Actual and forecasted sales for selected months in 2010 are as follows:MonthSalesRevenueJanuar$70,000yFebrua50,000ryMarch 40,000MonthSalesRevenueApril50,000May60,000June70,000July90,000August 80,000Monthly operating expenses are as follows:Wages andsalaries$27,000Depreciation100Utilities1,000Rent1,000Cash dividends of $17,000 are declared during the third month of each quarter and are paidduring the first month of the following quarter. Operating expenses, except insurance, rent,and depreciation are paid as incurred. Rent is paid during the following month. The prepaidinsurance is for five more months. Cost of goods sold is equal to 50 percent of sales. Endinginventories are sufficient for 120 percent of the next month’s sales. Purchases during anygiven month are paid in full during the following month. All sales are on account, with 50percent collected during the month of sale, 40 percent during the next month, and 10percent during the month thereafter. Money can be borrowed and repaid in multiples of$1,000 at an interest rate of 12 percent per year. The company desires a minimum cashbalance of $2,000 on the first of each month. At the time the principal is repaid, interest ispaid on the portion of principal that is repaid. All borrowing is at the beginning of the month,and all repayment is at the end of the month. Money is never repaid at the end of the monthit is borrowed.(a) Prepare a purchases budget for each month of the second quarter ending June 30, 2010.Peyton Department StoreMonthly Purchase BudgetQuarter Ending June 30, 2010AprilBudgetedpurchases$AnswerMay$AnswerJune$AnswerTotal$Answer(b) Prepare a cash receipts schedule for each month of the second quarter ending June 30,2010. Do not include borrowings.Only use negative signs, if needed, for: excess receipts over disbursements,balance before borrowings and cash balances (beginning and ending).Peyton Department StoreSchedule of Monthly Cash ReceiptsQuarter Ending June 30, 2010AprilTotal cashreceiptsMay$AnswerJune$AnswerTotal$Answer$Answer(c) Prepare a cash disbursements schedule for each month of the second quarter endingJune 30, 2010. Do not include repayments of borrowings.Peyton Department StoreSchedule of Monthly Cash DisbursementsQuarter Ending June 30, 2010AprilTotal cashdisbursements$AnswerMay$AnswerJune$AnswerTotal$Answer(d) Prepare a cash budget for each month of the second quarter ending June 30, 2010.Include budgeted borrowings and repayments.Peyton Department StoreMonthly Cash BudgetQuarter Ending June 30, 2010AprilMayJune$Answer$Answer$Answer$AnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerExcess receipts over Answerdisb.AnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerCash balance,beginningReceiptsDisbursementsBalance beforeborrowingsBorrowingsTotalPeyton Department StoreMonthly Cash BudgetQuarter Ending June 30, 2010Loan repaymentsCash balance, endingAprilAnswerMayAnswerJuneAnswerTotalAnswer$Answer$Answer$Answer$Answer(e) Prepare an income statement for each month of the second quarter ending June 30,2010.Only use negative signs to show net losses in income.Peyton Department StoreBudgeted Monthly Income StatementsQuarter Ending June 30, 2010AprilSalesCost of salesGross profitMayJuneTotal$Answer$Answer$Answer$AnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerAnswerOperatingexpenses:Wages andsalariesDepreciationUtilitiesRentInsuranceInterestTotal expensesPeyton Department StoreBudgeted Monthly Income StatementsQuarter Ending June 30, 2010AprilNet income$AnswerMay$AnswerJune$AnswerTotal$Answer(f) Prepare a budgeted balance sheet as of June 30, 2010.Peyton Department StoreBudgeted Balance SheetJune 30, 2010AssetsCashAccountsreceivableInventoryPrepaidinsuranceFixturesTotal assetsLiabilities and Equity$AnswerMerchandise $AnswerpayableAnswerAnswerDividendpayableAnswerRent payableAnswerAnswerLoanspayableAnswerAnswerInterestpayableAnswer$AnswerStockholders’ AnswerequityTotal liab. &equity$AnswerCheckNext33897667Skip Assignment navigation-10WwSL11kvIL