Crane Company prepares monthly cash budgets. Relevant data from operating budgets for 2022 are as follows.

		January		February
Sales		$374,400		$416,000
Direct materials purchases		124,800		130,000
Direct labor		93,600		104,000
Manufacturing overhead		72,800		78,000
Selling and administrative expenses		82,160		88,400

All sales are on account. Collections are expected to be 50% in the month of sale, 30% in the first month following the sale, and 20% in the second month following the sale. Sixty percent (60%) of direct materials purchases are paid in cash in the month of purchase, and the balance due is paid in the month following the purchase. All other items above are paid in the month incurred except for selling and administrative expenses that include $1,040 of depreciation per month. Other data:

1.		Credit sales: November 2021, $260,000; December 2021, $332,800.
2.		Purchases of direct materials: December 2021, $104,000.
3.		Other receipts: JanuaryCollection of December 31, 2021, notes receivable $15,600; FebruaryProceeds from sale of securities $6,240.
4.		Other disbursements: FebruaryPayment of $6,240 cash dividend.

The companys cash balance on January 1, 2022, is expected to be $62,400. The company wants to maintain a minimum cash balance of $52,000.

Crane Company prepares monthly cash budgets. Relevant data from operating budgets for 2022 are as follows. January February $416,000 Sales $374,400 124,800 130,000 93,600 104,000 Direct materials purchases Direct labor Manufacturing overhead Selling and administrative expenses 72,800 78,000 82,160 88,400 All sales are on account. Collections are expected to be 50% in the month of sale, 30% in the first month following the sale, and 20% in the second month following the sale. Sixty percent (60%) of direct materials purchases are paid in cash in the month of purchase, and the balance due is paid in the month following the purchase. All other items above are paid in the month incurred except for selling and administrative expenses that include $1,040 of depreciation per month. Other data: 1. 2. 3. Credit sales: November 2021, $260,000; December 2021, $332,800. Purchases of direct materials: December 2021, $104,000. Other receipts: January-Collection of December 31, 2021, notes receivable $15,600; FebruaryProceeds from sale of securities $6,240. Other disbursements: February-Payment of $6,240 cash dividend. 4. The company's cash balance on January 1, 2022, is expected to be $62,400. The company wants to maintain a minimum cash balance of $52,000. (a) Your answer is correct. Prepare schedules for (1) expected collections from customers and (2) expected payments for direct materials purchases for January and February Expected Collections from Customers January February November $ 52000 $ December 99840 66560 January 187200 112320 February 0 208000 Total collections 339040 386880 Expected Payments for Direct Materials January February December 41600 $ 0 January 74880 49920 February 0 78000 Total payments 116480 $ 127920 eTextbook and Media Attempts: 3 of 5 used (b) Prepare a cash budget for January and February in columnar form. CRANE COMPANY Cash Budget January Beginning Cash Balance 62400 Add V Receipts Collections from Customers 339040 Notes Receivable [ Sale of Securities Receipts Total Available Cash Less Disbursements Direct Materials V Direct Labor > Manufacturing Overhead > [ Selling and Administrative Expenses > Cash Dividend Total Disbursements Ending Cash Balance Financing $ e Textbook and Media Save for Later Last saved 3 hours ago Attempts: 0 of 5 used Submit Answer (b) Prepare a cash budget for January and February in columnar form. CRANE COMPANY Cash Budget January February 62400 $ 52000 339040 356380 nents Expenses > $ e Textbook and Media Save for Later Last saved 3 hours ago Attempts: 0 of 5 used Submit