Here are some important figures from the budget of Cornell, Inc. for the second quarter of 2013:
April May June
Credit sales $486,000 $549,000 $586,8000
Credit purchases 240,1000 2888,100 286, 200
Cash disbursements
Wages, taxes, and expenses 62, 7000 86, 8000 95, 1000
Interest 17, 600 17, 600 17, 6000
Equipment purchase 127, 800 148,800
The company predicts that the 5 percent of its credit sales will never be collected, 35 percent of its sales will be collected in the month of the sale, and the remaining 60 percent will be collected in the following month. Credit purchases will be paid in the month following the purchase. In March 2013, credit sales were $459,000 and credit purchases were $248,400. Using the information, complete the following cash budget.
Beginning cash balance (342,000) April May June
Cash receipts
Cash collections from credit sales
Total cash available
Cash disbursements
Purchases
Wages, taxes, and expenses
Interest
Equipment purchases
Total cash disbursements
Ending balance