Thumbtacks March 31, 2014, balance sheet follows: The budget committee of Thumbtack Office Supply has assembled the

Thumbtack’s March 31, 2014, balance sheet follows:

The budget committee of Thumbtack Office Supply has assembled the following data.
a. Sales in April are expected to be $ 40,000. Thumbtack forecasts that monthly sales will increase 2% over April sales in May. June’s sales will increase by 4% over April sales. July sales will increase 20% over April sales. Cash receipts are 80% in the month of the sale and 20% in the month following the sale.
b. Thumbtack maintains inventory of $ 11,000 plus 25% of the cost of goods sold budgeted for the following month. Cost of goods sold equal 50% of sales revenue. Purchases are paid 30% in the month of the purchase and 70% in the month following the purchase.
c. Monthly salaries amount to $ 7,000. Sales commissions equal 5% of sales for that month. Salaries and commissions are paid 30% in the month incurred and 70% in the following month. d. Other monthly expenses are as follows:
Rent: $ 2,400, paid as incurred
Depreciation: $ 200
Insurance: $ 100, expiration of prepaid amount
Income tax: $ 1,700, paid as incurred

Requirements
1. Prepare Thumbtack’s sales budget for April and May 2014. Round all amounts to the nearest $ 1.
2. Prepare Thumbtack’s inventory, purchases, and cost of goods sold budget for April and May.
3. Prepare Thumbtack’s selling and administrative expense budget for April andMay.

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THUMBTACK OFFICE SUPPLY Balance Sheet March 31, 2014 Assets urent Assets Cash Accounts Receivable Merchandise Inventory Prepaid Insurance Total Current Assets $ 18,000 12,000 16,000 2,200 5 48,200 Property, Plant and Equipment: Equipment and Fixtures Less: Accumulated Depreciation otal Assets 45,000 30,000) 15,000 S 63,200 Liabilities urrent iabilities Accounts Payable Salaries and Commissions Payable otal abilities 12,500 1,400 5 13,900 Stockholders' Equity 16,000 33,300 ommon Stock Retained Earnings 49,300 S 63,200 Total StockholdersEquity otal iabilities and Stockholdrs Equity