Grove, Inc. is a wholesaler for its only product, deluxe wireless electric drills, which sell for \($90\) each and cost Grove \($54\) each. On December 1, 2016, Grove’s management requested a cash budget for December. The following selected account balances at November 30, 2016, were gathered by the accounting department:

Actual sales for the months of October and November were 20,000 and 30,000 units, respectively.
Projected unit sales for December and January are 50,000 and 40,000, respectively. Experience indicates that 50% of sales should be collected in the month of sale, 30% in the month following sale, and the balance in the second month following sale. Uncollectible accounts, returns, and allowances are negligible.
Planned purchases should provide ending inventories equal to 30% of next month’s unit sales volume. Approximately 70% of the purchases are paid for in the month of purchase and the balance in the following month.
Monthly operating expenses are budgeted at \($8.10\) per unit sold plus a fixed amount of \($189,000\) including depreciation of \($81,000.\) Except for depreciation, 60% of operating expenses are paid in the month incurred and the balance in the following month. Interest expense is included in operating expenses.

Special anticipated year-end transactions include the following:
1.Declaration of a \($22,500\) cash dividend to be paid 2 weeks after the December 20 date of record.
2.Sale of one-half of the marketable securities held on November 30; a gain of \($21,000\) is anticipated.
3.Pay off the note payable due December 31, 2016.
4.Trade-in of an old computer originally costing \($675,000\) and now having accumulated depreciation of \($540,000\) at a gain of \($157,500\) on a new computer costing 

\($1,350,000.\) Sufficient cash will be paid at the time of trade-in so that only 50% of the total price will have to be financed.
5.Grove’s treasurer has a policy of maintaining a minimum month-end cash balance of 

\($135,000\) but wants to raise this to \($225,000\) at December 31. She has a standing arrangement with the bank to borrow any amount up to a limit of  \($450,000\) .

Required

Prepare\) a cash budget for Grove, Inc., for December 2016.

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Cash.. Marketable securities (at cost) Accounts receivable (all trade). Inventories (15,000 units). Operating expenses payable. Accounts payable (all merchandise). Note payable (due 12/31/2016) $ 135,000 210,000 1,710,000 810,000 140,400 583,200 393,000