5. Sweet Corn has only credit sales and no cash sales. Therefore, cash collections from A/R are critically important to manage. Through its history, Sweet Corn collects its customers' Accounts Receivable balances according to the following pattern. History of Cash Collection % collected same month 60% % collected next month. 40% Budgeted credit sales for the month come from the sales forecast. Begin by determining the Collections in July. Determine the total cash collections for the three months listed below. June's credit sales of $12,500 July's credit sales of $14,000 August's credit sales of $13,800 September's credit sales of $14,360 July-22 Aug.-22 Sept.-22 Quarter Beginning Cash collections for June $5,000 Total Cash collections: 7. Jamie, Tiffany, and Celeste have a taco stand at the park. Their bank requires them to maintain a $5,000 minimum cash balance at all times and has provided a line of credit to assist with daily cash flow needs and to maintain the minimum cash balance. The friends' prudent budgeting has predicted a shortfall of $2,590 in January when loyal customers start their annual post-holiday diets. The line of credit bears interest annually at 6 % (6% is the annual rate), and funds will be accessed in $100 increments on the first day of the month, for that month's needs. Interest must be paid each month on the outstanding balance (1 month increments), but principal payments are not required each month. The following schedule shows the activity for January and February: 1. Beginning cash balance=$6,000 2. Cash receipts for January = $76,000 and $88.700 for February 3. Cash disbursements for January $83,590 and $79,400 for February 4. Interest PxRxt Prepare the Cash budget for January and February. Cash Budget Beginning Cash Balance Cash receipts Total cash available Cash disbursements Cash surplus (deficiency) Financing: Proceeds from borrowing Principal repayments Interest payments Ending cash balance: January $6,000 February