Cash Budget The controller or Sonoma Housewares Inc. Instructs you to prepare a monthly cash budget for the next three months. You are presented with the following budget Information: May June July Sales $16.000 $90,000 $95,000 Manufacturing 34,000 39,000 14,000 costs 15,000 16,000 22,000 Saling and administrative expenses Capital 80,000 The company expects to sell about 10% of its merchandise for cash. Of sales on account, 70% are expected to be collected in the month following the sale and the remainder the following month (second month following sele). Depreciation, insurance, and property tax expense represent $3,500 of the estimated monthly manufacturing costs. The annual Insurance premium is peld in September, and the annual property taxes are paid in November of the remainder of the manutacturing costs, 80% are expected to be paid in the month in which they are incurred and the balance in the following mant. Current assets as of May 1 include cash of $33,000, marketable securities of $40,000, and scounts receivable of $90,000 ($72,000 from April sales and $18.000 from March sales) Sales on account for March and April were $60,000 and $72,000, respectively. Current liabilities as of May 1 include $6.000 of accounts payable incurred in April for manufacturing costs. All selling and administrative experses are paid in cash in the period they are incurred. An estimated Income tax payment of $14,000 will be made in June. Sonoma's regular quarterly dividend of $5,000 is expected to be declared in June and paid in July. Management wants to maintain a minimum cash balance or $30,000. Required 1. Frepare a monthly cash budoet and supporting schedules for May, June, and duly. Input all amounts as positive values except overall cash decrease and deficiency which should be indicated with a minus sign. Sonoma Housewares Inc. Cash Budget For the Three Months Ending July 31 May June July Estimated cash receipts from: Cash sales Collection of sccounts receivable Total cash receipts Estimated cash payments for: Manufacturing casts Selling and administrative expenses Capital expenditures Other purposes Income tax Dividends Total cash payments Cash increase or decrease) Cash balance at beginning of month Cash balance at end of manth Minimum cash balance Excess or deficiency | 0 0 (11) (0) 01 0000000