E6-34 (similar to) Health World is a retail store selling home oxygen equipment. Health World also services home oxygen equipn due to a recent advertising campaign. The forecast of sales and service revenue for March-June 2018 is as fc (Click the icon to view the forecast of sales and service revenue.) (Click the icon to view the coll Read the requirements. Requirement 1. Calculate the cash that Health World expects to collect in May and in June 2018. Show calcu Start by showing the cash collections of sales revenue, then complete the schedule by entering in the service for a certain month, select "0%" in the "Collection %" column and enter a "0" in the appropriate May or June Gross Expected Revenue Collection % April Sales revenue: April sales revenue collected in Apr May sales revenue collected in May June sales revenue collected in June quipment, for which the company bills customers monthly. Health World has budgeted for increases in service revenue of $500 each month as follows: e collection information.) calculations for each month. ervice revenue collections and the total cash collections for each month. (Complete all answer boxes. If there were no collections of revenue une column.) 0 Requirements 1. Calculate the cash that Health World expects to collect in April, May and June 2018 from sales and service revenue. Show calculations for each month. HealthWorld has budgeted expenditures for May of $13,000 and requires a minimum cash balance of $290 at the end of each month. It has a cash balance on May 1 of $450. a. Given your answer to requirement 1, will Health World need to borrow cash to cover its payments for May and maintain a minimum cash balance of $290 at the end of May? b. Assume (independently for each situation) that (1) May total revenues might also be 10% lower or that (2) total costs might be 5% higher. Under each of those two scenarios, show the total net cash for May and the amount Health World would have to borrow to cover its cash payments for May and maintain a minimum cash balance of $290 at the end of May. (Again, assume a balance of $450 on May 1.) Why do Health World's managers prepare a cash budget in addition to the revenue, expenses, and operating income budget? Has preparing the cash budget been helpful? Explain briefly. i Data Table Total Revenue Month March 11,600 Sales and Service Revenues Budget March-June 2018 Expected Sales Revenue Expected Service Revenue $ 7,000 4,600 9,000 5,100 8,700 5,600 9,700 6,100 April 14,100 14,300 May June 15,800 * More Info Almost all of the sales revenues of the oxygen equipment are credit card sales; cash sales are negligible. The credit card company deposits 97% of the revenues recorded each day into Health World's account overnight. For the servicing of home oxygen equipment, 60% of oxygen services billed each month is collected in the month of the service, and 40% is collected in the month following the service. Print Done