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You have been asked to prepare a December cash budget for Ashton Company, a distributor of exercise equipment. The following information is available about the company's operations: a. The cash balance on December'l is $53,400. b. Actual sales for October and November and expected sales for December are shown below. Sales on account are collected over a three-month period as follows: 20% collected in the month of sale, 60% collected in the month following sale, and 18% collected in the second month following sale. The remaining 2% is uncollectible. October November December Cash sales $ 7?,000 $ 31,200 $ 3?,300 Sales on account 435,006 538,000 644,000 c. Purchases of inventoryr will total $341,000 for December. Thirty percent of a month's inventory purchases are paid during the month of purchase. The accounts payable remaining from November's inventory purchases total $155,000, all of which will be paid in December. d. Selling and administrative expenses are budgeted at $515,000 for December. Of this amount, $94,900 is for depreciation. e. A new web server forthe Marketing Department costing $121,500 will be purchased for cash during December, and dividends totalling $13,000 will be paid during the month. f. The company maintains a minimum cash balance of $20,000. An open line of credit is available from the company's bank to bolster the cash position as needed. Required: 1. Prepare a schedule of expected cash collections for December. December cash sales Collections on aocount: October sales November sales December sales Total cash colleciiorls 2. Prepare a schedule of expected cash disbursements during December for merchandise purchases. Payments to suppliers: November purchases December purchases Total cash payments 3. Prepare a cash budget for December. Indicate in the nancing section any borrowing that will be needed during the month. Assume that any interest will not be paid until the following month. Beginning cash balance Add collections from customers Total cash available Less cash disbursements: Payments to suppliers for inventory Selling and administrative expenses New web server Drvldends paid Total cash disbursements Excess [deciency] of cash available over disbursements Financing: Repayments Interest Total nancing

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