Cash bodget The controller of Bnidgeport Houstwares Inci instructs you to prepare a monthly cach budget for the next three months, You are presemted with the following budget information The company expects to sell about 105 of its merchandise for cash. of sales on account, 700 are expected to be collected in the month foliowing the sale and the femainder the following month (second month following sale). Dopreciation, insurance, and property tax expense ropresent 59,000 of the estimated monthly manudacturing costa. The annual insurance premilam is paid in January, and the annual property taxes are paid in December. Of the remainder of the manufacturing costs, Bow are expected to be paid in the month in which the are incured and the bolance in the following month. Current ascets as of September 1 include cash of 556,000 , marketable securibes of $79,000, and accounts receivable of s154,400 $535,400 trom July sales and $120,000 frem Augutt rales). Sales on account for July and August were $116,000 and 5129,000 , respectively Current lisbilities as of September 1 include 59,000 af accounts payable incurred in Augurt foe manulacturing costs. All seling and administrotive expenses are paid in cash in the period they are incurred. Aa batimated income tax payment of s22,000 wil bo made in Cctober, Bridgeport's regular quarterly dividend of $9,000 expected to be declared in October and paid in November. Management desires to maintain a minimum cash baiance of $55,000. 1. Prepare a monthly cash budget and supporting schedules for September, October, and November. Assume 360 divs per year for interest caleulations: 2. On the basis of the cash budget prepared in part (1). what recommendation should be made to the controller? The budget indicates that the minimum cash balance be maintained in November. This situation can be corrected by of the marketable secumties, if they are held for such purposes. At the end of Seotembec and october, the cash balance wid minimaim desired baisnce