8 0 Saved Help Save& Exit Subm 2 Check my work The president of the retailer Prime Products has just approached the company's bank with a request for a $30,000, 90-day loan. The purpose of the loan is to assist the company in acquiring inventories Because the company has had some dimiculty in paying off its oans in the past, the loan officer has asked for a cash budget to help determine whether the loan should be made. The following deta are available for the months April through June, during which the loan will be used a On April 1, the start of the loan period, the cash balance will be $40,000 Accounts receivable on Apri 1 will sotal $187600, of which $152,000 will be collected during April and $27,200 will be collected during May The remainder will be uncolectible b. Past expe ence shows that 30% of a month's sales are colected in the monn or sa e sonne enn olo ng ae na rin the second month following sale. The other 2% is bad debts that are never collected Bdgeted sales and expenses for hemre. month period follow AprilMay June 336,000 $414,000 285,000 240,00 5145, 500 158,000 16,000 16.DOD 27,000 22,600 22,600 22,s00 73,400 $ 73,400 40,800 Salea (all on account ) Merchandise parehases Payroli Equipment parchases 1025 s 19,800 19,8 19.800 c Merchandise purchases are paid in full duning the month following purchase Accounts payable for merchandise purchases during March, which will be paid in April, total $187,000 d neparing the cash budget assume that the $3000loan wll e made in Aphil and repaid in June, interest on the lon we Required: 1 Calculate the expected cash collections for April, May, and Aune, and for the three months in to 2 Prepar a cosh budget, by month and in total, for the three month period