Given the following information, prepare a cash budget for June 2022. The records of the company show the following:

• Cash balance on June 1 is $100 000.

• Expected sales for June comprise cash sales of $2 000 000 and credit sales of $4 000 000.

• Actual sales for April and May are as follows:

April May

$ $

Cash sales 1 000 000 1 500 000 Credit sales 2 500 000 3 500 000 Total sales 3 500 000 5 000 000

• Credit sales are collected over a three-month period: 50 per cent in the month of sale, 30 per cent in the second month, and 15 per cent in the third month. The remaining sales are uncollectable.

• Inventory purchases average 60 per cent of a month’s total sales. Of those purchases, 40 per cent are paid for in the month of purchase. The remaining 60 per cent are paid for in the following month.

• Salaries and wages total $800 000 a month.

• Rent is $100 000 per month.

• Taxes to be paid in June are $500 000.

• There is no minimum cash balance required.