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 2012. 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.
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Beginning cash balance
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$30,000
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Required minimum cash balance
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25,000
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Payment of income taxes (2nd quarter)
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4,000
|
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Professional salaries:
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|
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1st quarter
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140,000
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2nd quarter
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140,000
|
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Interest from investments (2nd quarter)
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5,000
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Overhead costs:
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|
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1st quarter
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75,000
|
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2nd quarter
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100,000
|
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Selling and administrative costs, including
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|
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$3,000 depreciation:
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|
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1st quarter
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50,000
|
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2nd quarter
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70,000
|
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Purchase of equipment (2nd quarter)
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50,000
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Sale of equipment (1st quarter)
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15,000
|
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Collections from clients:
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|
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1st quarter
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230,000
|
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2nd quarter
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380,000
|
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Interest payments (2nd quarter)
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300
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Instructions
Prepare a cash budget for each of the first two quarters of 2012.