Duffy Corporation has prepared the following sales budget:

Month Cash Sales Credit Sales Total Sales

May $17,000 $68,000 $85,000

June $21,000 $80,000 $101,000

July $19,000 $74,000 $93,000

August $25,000 $92,000 $117,000

September $23,000 $76,000 $99,000

Collections are 40 percent in the month of sale, 45 percent in the month after the sale, and 10 percent two months following the sale. The remaining 5 percent is expected to be uncollectible. Cash payments are as follows:

- July.$95,000

August..$98,000

September$93,000

The beginning cash balance is $12,000, Duffys management decided on a minimum cash balance during this period of $15,000.

You are required to:

a Prepare schedule of cash receipts for July through September

b. Prepare the cash budget for July through September

c. List five advantages associated with the preparation of budgets