During the last week of August, Oneida Company's owner approaches the bank for a $107,500 loan to be made on September 2 and repaid on November 30 with annual interest of 15%, for an interest cost of $4,031. The owner plans to increase the store's inventory by $60,000 during September and needs the loan to pay for inventory acquisitions. The bank's loan officer needs more information about Oneida's ability to repay the loan and asks the owner to forecast the store's November 30 cash position. On September 1, Oneida is expected to have a $4,000 cash balance, $123,200 of net accounts receivable, and $100,000 of accounts payable. Its budgeted sales, merchandise purchases, and various cash disbursements for the next three months follow. October Budgeted Figures* September $210,000 225,000 November $455,000 220,000 $470,000 199,000 Sales Merchandise purchases Cash payments Payroll Rent 23,800 20,100 22,100 9,000 30,000 9,000 34,200 9,000 Other cash expenses 20,900 107,500 Repayment of bank loan Interest on the bank loan 4,031 *Operations began in August; August sales were $160,000 and purchases were $125,000. Cash payments Payroll 22,100 9,000 30,000 20,100 9,000 34, 200 23,800 9,000 Rent Other cash expenses 20,900 107,500 Repayment of bank loan Interest on the bank loan 4,031 Operations began in August; August sales were $160,000 and purchases were $125,000. The budgeted September merchandise purchases include the inventory increase. A|l sales are on account The company predicts that 23% of credit sales is collected in the month of the sale, 47% in the month following the sale, 19% in the second month, 7% in the third, and the remainder is uncollectible. Applying these percents to the August credit sales, for example, shows that $75,200 of the $160,000 will be collected in September, $30,400 in October, and $11,200 in November. All merchandise is purchased on credit; 90% of the balance is paid in the month following a purchase, and the remaining 10% is paid in the second month. For example, of the $125,000 August purchases, $112,500 will be paid in September and $12,500 in October. Required: Prepare a cash budget for September, October, and November. (Round your final answers to the nearest whole dollar.) Answer is complete but not entirely correct. Calculation of cash receipts from sales November Collected in--- Accounts Total Sales September Uncollectible August October November Rec. Credit sales from: 6,400 $ 36,800 $ 75,200 $ 30,400 S 11,200 $ August 160,000 0 8,400 September 98,700 x 39,900 14,700x 210,000 48,300 86,450 x October 455,000 18.200 31,850 318,500 32,900X November 470,000 18.800 418,300 36,800 1,295,000 173,900 156,750 90,650 785,100 Totals Calculation of cash payments for merchandise November --Paid in- 30. Total Accounts August September October November Purchases Pay Purchases from: 112,500$ 1.250 e S $ August 125,000 0 202,500 September 225,000 2.250 20,250 Calculation of cash payments for merchandise November 30. -Paid in---- Total Purchases Accounts September October August November Pay. Purchases from: 112,500 $ 1,250 x August 125,000 0 202,500 2,250 x September 225,000 20,250 198,000 October 220,000 22,000 November 199,000 199,000 769,000 112,500 203,750 $ $ 200,250 241,250 Totals ONEIDA COMPANY Cash Budget For September, October, and November September October November Beginning cash balance $ 4,000 Cash receipts Collection on accounts receivable X Interest on bank loan Total cash available Cash payments: Payments on accounts payable Payroll Rent Other cash expenses Payments on accounts payable x Repayment on bank loan Interest on bank loan Total cash payments 0 0 Ending cash balance