'Balance Sheet and Following Account Balances\r'

'Retained earnings 109,oho 712,000 712. 000 b. Actual gross sales for December and budgeted sales for the next four calendar months ar as follow s: †December (actual) 2800 units It is expect that sales forget increase by 40% in the month of January and by a advance 50% in the next month. The side by side(p) month sales would drop by 50% an d then depart will ream remain in cons Tanta for for the next next 2 moon months this †The way will not alter the selling price, which is presently $100 †charge wants end goods inventory to be 20% of the following months sales †One units of finished goods require 2 kilos of warm materials. â€The price of materials is currently $10 per kilo and is expected to increase by 50% in February hereafter it will remain constant for the next four months. †The management wants raw materials inventory to be 10% of the following months p reduction needs †Each unit of convergence requires 2 hours of direct material s for completion. †The projectioners argon expected to civilise for a total of 4000 hours per month at a wage rat e Of $6 per hour. any additional work requires an over m payment of time and a half. †Manufacturing overhead: variable: $5 per labor hours worked; fixed $17000 per MO nth. †Sales are 20% for hard cash and 80% on credit.Half of the credit sales are quiet in the month following sale while the remaining half is collected in second month after the sales. The accounts receivable at December 31 are a result of December credit sales. †Monthly expenses are budgeted as follows: salaries and wages, $10,000 per month: a advertising, $70,000 per month; shipping, 5% of sales; other expenses, 3% of sales. Depreciation, I including depreciation on new assets acquired during the dry quarter, will be $42,000 for the quart err. †One- half of a months raw materials purchases is paid for in the month of purchase; the to her half is paid in the following month. Shipping expenses are paid in the month following the shipment. , while advertising I s paid in one months advance. During February, the company will purchase a new copy political machine for $1,700 cash. Du ring March, other equipment will be purchased for cash at a cost of $84,500. †During January, the company will declare and pay $45,000 in cash dividends. †Management wants to maintain a minimum cash counterweight of $30,000. The company h as an agreement with a local bank that allows the company to borrow in increments of $1,0 00 at the beginning of each month. The interest invest on these loans is 1% per month and for is\r\n'