Assume 90 day quarters. Only use whole numbers. No decimals.

At the beginning of the first quarter fiscal year 2017, Callahans Inc. has a cash balance of $460. During the quarter, the company collects the quarters sales plus the beginning A/R balance. Callahans material cost is 55% of sales and they purchase the material a quarter before the sale. Their accounts payable period is 25 days and the beginning A/P balance is $73. They have debt of $800 for which they pay 2.5% interest every quarter. They also have a tax payment of $70 every quarter. Wages and other expenses are 20% of sales.

Prepare a cash budget for Callahans for their fiscal year 2017 based on the below sales forecast. Suggest a minimum amount of cash you feel they should always maintain, use your suggestion to calculate surplus/deficit, and explain your reasoning.

Sales forecast

Q4FY16 Q1FY17 Q2FY17 Q3FY17 Q4FY17 Q1FY18

$480 $480 $560 $600 $800 $800

Callahans Inc. Cash budget FY2017

			Q1		Q2		Q3		Q4
Beginning Balance
+ Total Cash Collection
Account Payable
Interest
Tax payments
Wages & other expenses
- Total Cash Disbursements
Ending Balance
- Minimum Balance
Surplus/Deficit