eBook Question Content Area Cash Budget Dr. Roger Jones is a successful dentist but is experiencing recurring financial difficulties. For example, Dr. Jones owns his office building, which he leased to the professional corporation that housed his dental practice. (He owns all shares in the corporation.) After the corporations failure to pay payroll taxes for the past 6 months, however, the Internal Revenue Service is threatening to impound the business and sell its assets. Also, the corporation has had difficulty paying its suppliers, owing one of them over $200,000 plus interest. In the past, Dr. Jones had borrowed money on the equity in either his personal residence or his office building, but he has grown weary of these recurring problems and has hired a local consultant for advice. According to the consultant, the financial difficulties facing Dr. Jones have been caused by the absence of proper planning and control. Budgetary control is sorely needed. The following financial information is available for a typical month: Revenues Average Fee ($) Quantity Fillings 50 90 Crowns 300 19 Root canals 170 8 Bridges 500 7 Extractions 45 30 Cleaning 25 108 X-rays 15 150 Costs Salaries: Two dental assistants $1,900 Receptionist/bookkeeper 1,500 Hygienist 1,800 Public relations (Mrs. Jones) 1,000 Personal salary 6,500 Total salaries $12,700 Benefits 1,344 Building lease 1,500 Dental supplies 1,200 Janitorial 300 Utilities 400 Phone 150 Office supplies 100 Lab fees 5,000 Loan payments 570 Interest payments 500 Miscellaneous 200 Depreciation 700 Total costs $24,664 Benefits include Dr. Joness share of social security and a health insurance premium for all employees. Although all revenues billed in a month are not collected, the cash flowing into the business is approximately equal to the months billings because of collections from prior months. The office is open Monday through Thursday from 9:00 a.m. to 4:00 p.m. and on Friday from 9:00 a.m. to 12:30 p.m. A total of 32 hours are worked each week. Additional hours could be worked, but Dr. Jones is reluctant to do so because of other personal endeavors that he enjoys. Dr. Jones has noted that the two dental assistants and receptionist are not fully utilized. He estimates that they are busy about 65 to 70% of the time. His wife spends about 5 hours each week on a monthly newsletter that is sent to all patients. She also maintains a birthday list and sends cards to patients on their birthdays. Dr. Jones recently attended an informational seminar designed to teach dentists how to increase their revenues. An idea from that seminar persuaded him to invest in promotion and public relations (the newsletter and the birthday list). Required: Question Content Area 1. Prepare a monthly cash budget for Dr. Jones. Enter amounts as positive numbers unless there is a deficiency