To illustrate the budgeting process we will use as an example the ABC company as followsGiven data1. The budgeted period:-July-Sep. 20-- for 3 months2. The actual balance sheet. June 30th .20-- is shown belowABC CompanyBalance sheetJune 30th .20---Assets liability & capitalCash 20,000 Account payable (loan) 16,000A/R 12,000 Wages payable 3,000Inventory 16,000 Commission payable 600Prepaid insur 10,000 Owners equity 54,400Equipment 30,000Acc. Depre (14,000)Total 74,000 Liabilities & Capital 74,000 1. All sales are made 60% on account & 40% on cash. The credit sales are entirely collected the following month of sales2. Cost of goods sold is estimated at 65% of sales & ending inventory of $ 40,000 is desired at the end of any month3. Purchases are made 60% on account & 40% on cash. The credit purchases are paid in the following month of purchase4. Sales men commission are estimated to be 10% of sales5. Cost equipment & insurance expire at a rate of 20% on book value per month6. Payments for wages and commission are made 70% in the month and 30% in the following month7. Minimum cash balance of $ 20,000 is required at the end of any month8. Money can be borrowed at 9% interst borrowing are made at the begin & repayments are end of months on FIFO based in multiple of $ 2,0009. The organization has plan to purchase a new equipment in the first half of August for $ 10,000 that will be used expenditure to acquired fixed assetForecast for wages and sales are as followsJuly August SeptemberSales 20000 100000 18000Wages 6000 4000 4000Required: prepared a master budget for three months ending sep 30. 2011A. Sales budgetB. Collection from salesC. Purchase budgetD. Disbursements for purchase doc.