Exercise 5-28

John Wills, Bates & Hill Fabricators budget director, has received budget information from several managers and is preparing the companys cash budget.

January	February	March	Quarter
Collections from sales	311,460	565,500	602,700	1,479,660
Payments for direct materials	46,680	69,600	82,310	198,590
Payments for direct labor	128,760	221,560	196,040	546,360
Payments for manufacturing overheads	100,207	103,455	102,561	306,223
Payments for Selling & administrative expenses	59,740	76,270	72,790	208,800

In addition to the information he received from these managers, John knows the following:

	Bates & Hill plans to have $69,000 in its cash account on January 1.
	Bates & Hill plans to declare and pay dividends totaling $56,800 in January.
	Bates & Hill plans to purchase and pay cash for a piece of land in February at a cost of $83,520.
	Bates & Hill plans to purchase Equipment in March at a cost of $69,600.
	Bates & Hills income taxes from last quarter totaling $87,300 will be paid in January.
	Bates & Hill is required to maintain a minimum cash balance of $34,800 in its account at First National Bank.

Bates & Hill has negotiated with the First National Bank to provide a $203,000 line of credit that can be borrowed against in $1,000 increments on the first day of the month. Any repayments on the line of credit must also be made in $1,000 increments and are made on the last day of the month when cash is available. The annual interest rate on this line of credit is 14%. Any time a principal payment is made, all accrued interest to date is repaid.

Prepare Bates & Hills cash budget for the first quarter. (Round answers to 0 decimal places, e.g. 5,275. Enter answers in necessary fields only. Leave other fields blank. Do not enter 0. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

January	February	March	Quarter
	$	$	$	$
:
:
	$	$	$	$