Aztec Company sells its product for $160 per unit. Its actual and projected sales follow.All sales are on credit. Recent experience shows that 30% of credit sales is collected in the month of the sale, 40% in the month after the sale, 26% in the second month after the sale, and 4% proves to be uncollectible. The products purchase price is $110 per unit. All purchases are payable within 13 days. Thus, 60% of purchases made in a month is paid in that month and the other 40% is paid in the next month. The company has a policy to maintain an ending monthly inventory of 20% of the next months unit sales plus a safety stock of 90 units. The April 30 and May 31 actual inventory levels are consistent with this policy. Selling and administrative expenses for the year are $1,956,000 and are paid evenly throughout the year in cash. The companys minimum cash balance at month-end is $130,000. This minimum is maintained, if necessary, by borrowing cash from the bank. If the balance exceeds $130,000, the company repays as much of the loan as it can without going below the minimum. This type of loan carries an annual 10% interest rate. On May 31, the loan balance is $44,500, and the companys cash balance is $130,000. (Round final answers to the nearest whole dollar.)Required:1.
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