Exercise 20-32A (Algo) Merchandising: Cash budget and schedule of cash receipts LO P4

Kelsey is preparing its master budget. Budgeted sales and cash payments for merchandise purchases for the next three months follow.

Budgeted	July	August	September
Sales	$62,600	$ 81,400	$ 49,400
Cash payments for merchandise purchases	43,200	32,200	33,000

Sales are 20% cash and 80% on credit. Sales in June were $57,650. All credit sales are collected in the month following the sale. The June 30 balance sheet includes balances of $13,700 in cash and $6,400 in loans payable. A minimum cash balance of $9,000 is required. Loans are obtained at the end of any month when the preliminary cash balance is below $9,000. Interest is 1% per month based on the beginning-of-the-month loan balance and is paid at each month-end. If a preliminary cash balance above $9,000 at month-end exists, loans are repaid from the excess. Expenses are paid in the month incurred and consist of sales commissions (10% of sales), office salaries ($5,400 per month), and rent ($7,900 per month).

(1) Prepare a schedule of cash receipts from sales for July, August, and September. (2) Prepare a cash budget for July, August, and September.

Complete this question by entering your answers in the tabs below. Prepare a schedule of cash receipts from sales for July, August, and September. Complete this question by entering your answers in the tabs below. Prepare a cash budget for July, August, and September. (Negative balances and Loan repayment amounts (if any) should be indicated with minus sign. Round your final answers to the nearest whole dollar.)