1 a. The cash balance on December 1 is $44,400. b. Actual sales for October and November and expected sales for December are shown below. Sales on account are collected over a three-month period as follows: 20% collected in the month of sale, 60% collected in the month following sale, and 18% collected in the second month following sale. The remaining 2% is uncollectible. ts Cash sales Sales on account October $ 72,600 425,000 November $ 86,600 601,000 December $ 89,000 617,000 eBook Print c. Purchases of inventory will total $358,000 for December. Thirty percent of a month's inventory purchases are paid during the month of purchase. The accounts payable remaining from November's inventory purchases total $207,000, all of which will be paid in December d. Selling and administrative expenses are budgeted at $459,000 for December. Of this amount, $64,500 is for depreciation. e. A new web server for the Marketing Department costing $114,000 will be purchased for cash during December, and dividends totalling $9,500 will be paid during the month. f. The company maintains a minimum cash balance of $20,000. An open line of credit is available from the company's bank to bolster the cash position as needed. ferences Required: 1. Prepare a schedule of expected cash collections for December. Schedule of Expected Cash Collections December cash sales Collections on account: October sales November sales December sales Total cash collections 0 2. Prepare a schedule of expected cash disbursements during December for merchandise purchases. ok Schedule of Expected Cash Disbursements Payments to suppliers: November purchases December purchases Total cash payments $ t 0 nces 3. Prepare a cash budget for December. Indicate in the financing section any borrowing that will be needed during the month. Assume that any interest will not be paid until the following month. ok Ashton Company Cash Budget For the Month of December Beginning cash balance Add collections from customers Total cash available t j 0 -nces Less cash disbursements: Payments to suppliers for inventory Selling and administrative expenses New web server 0 0 Dividends paid Total cash disbursements Excess (deficiency) of cash available over disbursements Financing Borrowings Repayments Interest Total financing Ending cash balance 0 $ 0