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Hillyard Company, an office supplies speclalty store, prepares Its master budget on a quarterly basis. The following data have been

assembled to assist In preparing the master budget for the first quarter:

a$.$ As of December $31($the end of the prior quarter$),$ the company's general ledger showed the following account balances:

b$.$ Actual sales for December and budgeted sales for the next four months are as follows:

c$.$ Sales are $20\%$ for cash and $80\%$ on credit. All payments on credit sales are collected in the month following sale. The accounts

recelvable at December $31$ are a result of December credit sales.

d$.$ The company's gross margin is $40\%$ of sales. $($In other words, cost of goods sold is $60\%$ of sales.$)$

e$.$ Monthly expenses are budgeted as follows: salarles and wages, $$30,000$ per month: advertising, $$66,000$ per month; shipping, $5\%$

of sales; other expenses, $3\%$ of sales. Depreclation, Including depreciation on new assets acquired during the quarter, will be

$$44,500$ for the quarter.

f$.$ Each month's ending Inventory should equal $25\%$ of the following month's cost of goods sold.

g$.$ One$-$half of a month's inventory purchases is paid for in the month of purchase; the other half is paid in the following month.

h$.$ During February, the company will purchase a new copy machine for $$2,500$ cash. During March, other equipment will be

purchased for cash at a cost of $$77,500.$

I. During January, the company will declare and pay $$45,000$ in cash dividends.

J$.$ Management wants to maintaln a minimum cash balance of $$30,000.$ The company has an agreement with a local bank that allows

the company to borrow in Increments of $$1,000$ at the beginning of each month. The interest rate on these loans is $1\%$ per month

and for simplicity we will assume that interest is not compounded. The company would, as far as it is able, repay the loan plus

accumulated interest at the end of the quarter. Complete this question by entering your answers in the tabs below.

Required $2A$

Required $2$B

Required $3$

Required $4$

Required $5$

Complete the cash budget. $($Cash deficiency, repayments and interest should be indicated by a minus sign.$)$ Complete this question by entering your answers in the tabs below.

Required $2A$

Required $2B$

Required $3$

Required $4$

Required $5$

Prepare an absorption costing income statement for the quarter ending March $31.$

$\backslash$table$[[$Hillyard Company$],[$Income Statement$],[$For the Quarter Ended March $31],[$F$,,],[$Cost of goods sold:$],[,,],[,,],[,0,],[,,0],[,,0],[$Selling and administrative expenses:$],[,,],[,,],[\backslash$bar $(7),,],[,,],[,,],[,,],[$Y$,,0],[,,0],[,,],[,,$$$]]$ Complete this question by entering your answers in the tabs below.

Required $2A$

Required $2B$

Required $3$

Required $4$

Required $5$

Prepare a balance sheet as of March $31.$

$\backslash$table$[[$Hillyard Company$],[$Balance Sheet$],[$March $31],[$Assets$],[$Current assets:$],[,,],[.,,],[,,],[,,],[,,],[$Total current assets,,$\backslash$bar $(0)],[$Y$],[$Total assets,$$,0],[$Liabilities and Stockholders' Equity$],[$Current liabilities:$],[,,],[,,],[$Stockholders$\text{'}$ equity:$],[,,],[,,],[,,],[,,0],[$Total liabilities and stockholders' equity,$$,0]]$

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