Sales for ABC Corp are as follows: November $220,000, December $175,000, January $190,000, February $120,000,...
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Sales for ABC Corp are as follows: November $220,000, December $175,000, January $190,000, February $120,000, March $135,000. They are 70% credit and 30% cash. Cash sales are collected in the month of the sale and credit sales are collected 50% in the month, 40% one month later and 10% two months later. Purchases are as follows: November $140,000, December $112,000, January $121,600, February $76,800, March $186,400. The purchases are paid for the next month. Other expenditures are $10,000 a month for rent, other expenses of $20,000 per month. The company plans a capital expenditure in February of $30,000. They plan to partially finance this with a bank loan of $15,000. A tax payment of $10,000 needs to be made in March. Prepare a cash budget for January through March with a beginning cash balance of $22,000.
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