Cash Budget

The following information is provided for Office Supplies Limited, a retail store.

September, October and November sales amounted to $300000, $320000 and $400000, respectively.

Sales for December and January are budgeted at $440000 and $420000, respectively.

Receipts are expected to be 50 percent in the month of sale, 38 per cent in the month following the sale and ten per cent in the second month following the sale. Two percent of sales are expected to be uncollectable.

Required:

A.Calculate the budgeted cash receipts for November, December and January.

B.Will you be able to estimate the total receipts for September and October. Provide justifications.