Based on the following Actuals and Projections construct a Q2 & Q3 Cash Flow Forecast and determine the liquidity ratios for XYZ Corp to see if they are improving or declining quarter over quarter. Calculate the Q2 and Q3 Current Ratio, Quick Ratio, and Cash Ratios?

Given this additional information:

• The firm collects 40% of sales in cash, 40% of its sales one month later, and 20% 2 months later (treat this as AR)
• Interest income of $90,000 on treasuries is realized at the end of each quarter (from Long Term, not Current Assets)
• The firm pays cash for 50% of its purchases and 50% the following month (consider this AP)
• In addition to AP, the firm carries $1 million in Current Liabilities
• Salaries and wages amount to 16.5 percent of the preceding month's sales.
• Sales commissions amount to 5 percent of the preceding month's sales.
• Lease payments of $75,000 must be made each month (Capital Lease Payments, not Current Liabilities).
• A principal and interest payment on an outstanding loan is due quarterly (EOQ) of $100,000.
• The firm has a beginning cash balance in April of $1,500,000
• Q2 Ending Inventory is 1,405,000 and Q3 Ending Inventory is $1,745,000

Based on the following Actuals and Projections construct a Q2 & Q3 Cash Flow Forecast and determine the liquidity ratios for XYZ Corp to see if they are improving or declining quarter over quarter. Calculate the Q2 and Q3 Current Ratio, Quick Ratio, and Cash Ratios? Month Sales Purchases January Actual $ 2,675,000 $ 1,850,000 February Actual $ 2,430,000 $ 2,550,000 March Actual $ 2,850,000 $2,100,000 April Forecast $ 2,700,000 $2,250,000 May Forecast $ 3,200,000 $ 2,500,000 June Forecast $ 3,500,000 $2,750,000 July Forecast $ 3,750,000 $3,000,000 August Forecast $ 3,400,000 $2,250,000 September Forecast $ 2,900,000 $ 2,000,000 Given this additional information: The firm collects 40% of sales in cash, 40% of its sales one month later, and 20% 2 months later (treat this as AR) Interest income of $90,000 on treasuries is realized at the end of each quarter (from Long Term, not Current Assets) The firm pays cash for 50% of its purchases and 50% the following month (consider this AP) . In addition to AP, the firm carries $1 million in Current Liabilities Salaries and wages amount to 16.5 percent of the preceding month's sales. Sales commissions amount to 5 percent of the preceding month's sales. Lease payments of $75,000 must be made each month (Capital Lease Payments, not Current Liabilities). A principal and interest payment on an outstanding loan is due quarterly (EOQ) of $100,000. The firm has a beginning cash balance in April of $1,500,000 Q2 Ending Inventory is 1,405,000 and 23 Ending Inventory is $1,745,000