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Bill Thomas, Sunland & Hill's controller, has received all the budgets prepared by the various operating units and is ready to compile the pro-forma financial statements for the first quarter. The company's balance sheet of December 31 is as follows: Cash Accounts Receivable (net Finished Goods Invento Raw Materials Inventory Property, Plant & Equipment Accumulated Depreciation $49,200 47,970 40,180 6,199 246,000 (61,500) $328,049 $ 14,760 61,713 82,000 169,576 Total Assets Accounts Payable Income Tax Payable Common Stock Retained Earnings Total Liabilities & Owners Equity $328,049 Selected Estimates Budgeted revenue Selling and administrative expense Interest expense Cash Cost of Goods Sold Accounts receivable (net Direct materials Finished goods Acounts payable Notes payable Quarter $1,156,200 218,448 2,772 25,236 822,763 111,930 4,559 48,392 27,224 33,620 Additional Information: Bates & Hill plans to declare and pay dividends totaling $40,180 in January. Bates & Hill plans to purchase and pay cash for a piece of land in February at a cost of $59,040 Bates & Hill plans to purchase equipment in March at a cost of $49,200 Depreciation for manufacturing overhead $24,600 per month and for selling and administrative $8,200 per month The company expects a 25% income tax rate, and all quarterly taxes are paid in the first month of the following quarter

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