Lager Dental Clinic is a medium-sized dental service specializing in family dental care. The clinic is currently preparing the master budget for the first 2 quarters of 2014. All that remains in this process is the cash budget. The following information has been collected from other portions of the master budget and elsewhere.
| Beginning cash balance |
|
$34,950 |
| Required minimum cash balance |
|
29,125 |
| Payment of income taxes (2nd quarter) |
|
4,660 |
| Professional salaries: |
|
|
| 1st quarter |
|
163,100 |
| 2nd quarter |
|
163,100 |
| Interest from investments (2nd quarter) |
|
5,825 |
| Overhead costs: |
|
|
| 1st quarter |
|
87,375 |
| 2nd quarter |
|
116,500 |
| Selling and administrative costs, including |
|
|
| $3,495 depreciation: |
|
|
| 1st quarter |
|
58,250 |
| 2nd quarter |
|
81,550 |
| Purchase of equipment (2nd quarter) |
|
58,250 |
| Sale of equipment (1st quarter) |
|
17,475 |
| Collections from clients: |
|
|
| 1st quarter |
|
267,950 |
| 2nd quarter |
|
442,700 |
| Interest payments (2nd quarter) |
|
350
|
Prepare a cash budget for each of the first two quarters of 2014.