Problem 8-26 Completing a Master Budget [LO2, LO4, LO7, LO8, LO9, LO10]

The following data relate to the operations of Picanuy Corporation, a wholesale distributor of consumer goods:

Current assets as of December 31:
Cash	$	6,000
Accounts receivable	$	36,000
Inventory	$	9,800
Buildings and equipment, net	$	110,885
Accounts payable	$	32,550
Capital stock	$	100,000
Retained earnings	$	30,135

a.	The gross margin is 30% of sales. (In other words, cost of goods sold is 70% of sales.)
b.	Actual and budgeted sales data are as follows:

December (actual)	$ 60,000
January	$ 70,000
February	$ 80,000
March	$ 85,000
April	$ 55,000

c.	Sales are 40% for cash and 60% on credit. Credit sales are collected in the month following sale. The accounts receivable at December 31 are the result of December credit sales.
d.	Each month