Cash budget and cash schedule

Question 1 (48 marks) Enterprise Lid has forecast its sales revenues and inventory purchases for the last five months of 2020 to be as follows: Sales Purchases August 27,000 $ 23,000 September 12,000 $ 19,000 October 29,000 $ 32,000 November 37,000 $ 25,000 December 26,000 $ 23,000 More information is below. In addition, its minimum required cash balance is $5,000. If there is a cash balance in excess of $5,000, Enterprise Lid will pay down any outstanding debt (if applicable). Proportion of sales on credit 50% Accounts receivable collected month after sale 60% Accounts receivable collected two months after sale 30% Accounts receivable nerer collected (bad debts) 10% Purchases are paid for 1 month after they occur Cash on hand at September 30 6,000 Outstanding debt at September 30 2,000 a) Prepare a schedule of cash receipts for October, November, and December. b) Prepare a cash budget for the same period