The controller of GH Company is gathering data to prepare the cash budget for April 2022. He plans to develop the budget from the following information.

a Of all sales, 30 per cent are cash sales.

b Of credit sales, 60 per cent are collected within the month of sale. Half of the credit sales collected within the month receive a 2 per cent cash discount (for accounts paid within 10 days). Twenty per cent of credit sales are collected in the following month; remaining credit sales are collected the month thereafter. There are virtually no bad debts.

c Sales for the first six months of the year are given as follows. (The first three months are actual sales and the last three months are estimated sales.)

Sales January $230 000 February 300 000 March 500 000 April 565 000 May 600 000 June 567 000 d The company sells all that it produces each month. The cost of raw materials equals 20 per cent of each sales dollar. The company requires a monthly ending inventory equal to the coming month’s production requirements. Of raw materials purchases, 50 per cent are paid for in the month of purchase. The remaining 50 per cent are paid for in the following month.

e Wages total $50 000 each month and are paid in the month of incurrence.

f Budgeted monthly operating expenses total $168 000, of which $22 000 is depreciation and $3000 is expiration of prepaid insurance. (The annual premium of $36 000 is paid on 1 January.)

g Dividends of $65 000, declared on 31 March will be paid on 15 April.

h Old equipment will be sold for $13 000 on 3 April.

i On 10 April new equipment will be purchased for $80 000.

j The company maintains a minimum cash balance of $10 000.

k The cash balance on 1 April is $12 500.

Required:

Prepare a cash budget for April. Give a supporting schedule that details the cash collections from sales.