Problem 8-29 (Static) Completing a Master Budget (LO8-2, LO8-4, LO8-7, LO8-8, LO8-9, LO8-10] The following data relate to the operations of Shilow Company, a wholesale distributor of consumer goods: Current assets as of March 31: Cash Accounts receivable $ 8,000 $ 20,000 Inventory $ 36,000 Building and equipment, net $ 120,000 Accounts payable Common stock Retained earnings $ 21,750 $ 150,000 $ 12,250 a. The gross margin is 25% of sales. b. Actual and budgeted sales data: March (actual) $ 50,000 $ 60,000 April May June July $ 72,000 $ 90,000 $ 48,000 c. Sales are 60% for cash and 40% on credit. Credit sales are collected in the month following sale. The accounts receivable at March 31 are a result of March credit sales. d. Each month's ending inventory should equal 80% of the following month's budgeted cost of goods sold. e. One-half of a month's inventory purchases is paid for in the month of purchase; the other half is paid for in the following month. The accounts payable at March 31 are the result of March purchases of inventory. f. Monthly expenses are as follows: commissions, 12% of sales; rent, $2,500 per month; other expenses (excluding depreciation), 6% of sales. Assume that these expenses are paid monthly. Depreciation is $900 per month (includes depreciation on new assets). g. Equipment costing $1,500 will be purchased for cash in April.