Herman Knorr, chief financial officer of Dallas Wireless, is responsible for the company€™s budgeting process. Knorr€™s staff is preparing the Dallas Wireless cash budget for 2015. A key input to the budgeting process is last year€™s statement of cash flows, which follows (amounts in thousands)

Requirements
1. Prepare the Dallas Wireless cash budget for 2015. Date the budget simply €œ2015,€ and denote the beginning and ending cash balances as €œbeginning€ and €œending.€ Assume the company expects 2015 to be the same as 2014, but with the following changes:
a. In 2015, the company expects a 25% increase in collections from customers and a 26% increase in purchases of inventory.
b. There will be no sales of investments in 2015.
c. Dallas Wireless plans to issue no stock in 2015.
d. Dallas Wireless plans to end the year with a cash balance of$4,675.

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A1 Dallas Wireless Statement of Cash Flows For the Year Ended December 31, 2014 (In thousands) Cash Flows from Operating Activitles Collections from customers $61,000 400 s i interest received Cash payments for inventory (46,000) Cash payments for operating expenses Net cash provided by operating activities 2,200 Cash Flows from Investing Activlties Purchases of equipment Purchases of investments (4,500 800 900 4,400) 11 12 Sales of investments Net cash used for investing activities Cash Flows from Financing Activities Payment of long-term debt 15 1ISsuance of stock 200) 1,400 500 Payment of cash dividends Net cash provided by financing actlvities Cash 20 Increase (decrease) in Cash Cash, beginning of year Cash, end of year 1,500 3,100 1