Deacon Company is a merchandising company that is preparing a budget for the three-month period ended June 30th. The following information is available Assets Cash Deacon Company Balance Sheet March 31 Accounts receivable Inventory Buildings and equipment, net of depreciation Total assets Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings Total liabilities and stockholders' equity Budgeted Income Statements Sales Cost of goods sold Gross margin Selling and, administrative expenses Net operating income Budgeting Assumptions: April $191,000 $ 68,400 35,600 67,300 179,000 $ 350, 300 114,600 76,400 16,900 $ 155,600 70,000 124,700 $ 350,300 May $ 201,000 120,600 80,400 18,400 $ 59,500 $ 62,000 $ 67,000 June $ 221,000 132,600 88,400 21,400 a. 60% of sales are cash sales and 40% of sales are credit sales. Twenty percent of all credit sales are collected in the month of sale and the remaining 80% are collected in the month subsequent to the sale. b. Budgeted sales for July are $231,000. c. 10% of merchandise inventory purchases are paid in cash at the time of the purchase. The remaining 90% of purchases are credit purchases. All purchases on credit are paid in the month subsequent to the purchase. The accounts payable at March 31 will be paid in April. d. Each month's ending merchandise inventory should equal $10,000 plus 50% of the next month's cost of goods sold. e. Depreciation expense is $1,400 per month. All other selling and administrative expenses are paid in full in the month the expense is incurred. Required: 1. Calculate the expectercash collections for April, May, and June. 2. Calculate the budgeted merchandise purchases for April, May, and June. 3. Calculate the expected cash disbursements for merchandise purchases for April, May, and June. 4. Prepare a budgeted balance sheet at June 30th. (Hint: You need to calculate the cash paid for selling and administrative expenses during April, May, and June to determine the cash balance in your June 30th balance sheet.)