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January February Marchinformation:

The company expects to sell about $15\%$ of its merchandise for cash. Of sales on account, $65\%$ are expected to be collected in full in the month

following the sale and the remainder the following month. Depreciation, insurance, and property tax expense represent $$8,000$ of the estimated

monthly manufacturing costs. The annual insurance premium is paid in June, and the annual property taxes are paid in October. Of the remainder of

the manufacturing costs, $80\%$ are expected to be paid in the month in which they are incurred and the balance in the following month. All sales and

administrative expenses are paid in the month incurred.

Current assets as of January $1$ include cash of $,$ marketable securities of $$54,000,$ and accounts recelvable of $$116,000($ $$88,000$ from

December sales and $$28,000$ from November sales$).$ Sales on account in November and December were $$80,000$ and $$88,000,$ respectively. Current

liabilities as of January $1$ include a $$50,000,12\%,90-$day note payable due March $20$ and $$8,000$ of accounts payable incurred in December for

manufacturing costs. All selling and administrative expenses are paid in cash in the period they are incurred. It is expected that $$3,000$ in dividends

will be received in January. An estimated income tax payment of $$15,000$ will be made in February. Shoe Mart's regular quarterly dividend of $$8,000$ is

expected to be declared in February and paid in March. Management desires to maintain a minimum cash balance of $$30,000.$

Required:

Prepare a monthly cash budget and supporting schedules for January, February, and March. Enter an increase in the month's cash balance or

an excess cash amount as a positive number. Enter a decrease in the month's cash balance or a cash deficiency as a negative number.

Assume $360$ days per year for interest calculations.

Sales $$100,000$ $$121,000$ $$165,000$

Manufacturing costs $42,00052,00059,000$

Selling and administrative expenses $29,00033,00036,000$

Capital expenditures $\_\_40,000$

The company expects to sell about $15\%$ of its merchandise for cash. Of sales on account, $65\%$ are expected to be collected in full in the month following the sale and the remainder the following month. Depreciation, insurance, and property tax expense represent $$8,000$ of the estimated monthly manufacturing costs. The annual insurance premium is paid in June, and the annual property taxes are paid in October. Of the remainder of the manufacturing costs, $80\%$ are expected to be paid in the month in which they are incurred and the balance in the following month. All sales and administrative expenses are paid in the month incurred.

Current assets as of January $1$ include cash of $$38,000,$ marketable securities of $$54,000,$ and accounts receivable of $$116,000($$$88,000$ from December sales and $$28,000$ from November sales$).$ Sales on account in November and December were $$80,000$ and $$88,000,$ respectively. Current liabilities as of January $1$ include a $$50,000,12\%,90-$day note payable due March $20$ and $$8,000$ of accounts payable incurred in December for manufacturing costs. All selling and administrative expenses are paid in cash in the period they are incurred. It is expected that $$3,000$ in dividends will be received in January. An estimated income tax payment of $$15,000$ will be made in February. Shoe Mart's regular quarterly dividend of $$8,000$ is expected to be declared in February and paid in March. Management desires to maintain a minimum cash balance of $$30,000.$

Required:

Question Content Area

$1.$ Prepare a monthly cash budget and supporting schedules for January, February, and March. Enter an increase in the month's cash balance or an excess cash amount as a positive number. Enter a decrease in the month's cash balance or a cash deficiency as a negative number. Assume $360$ days per year for interest calculations.

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