Five Bros., Inc., is an automobile maintenance and repair company with outlets throughout the western United States. The company controller is starting to assemble the cash budget for the fourth quarter. Projected sales for the quarter follow. Cash collection records pertaining to sales on account indicate the following collection pattern: Month of sale%40First month following sale%30Second month following sale%28Uncollectible %2Sales on account during August were $346,000. During September, sales on account were $390,000.Cash payments of the company are $586,000 for October; $682,000 for November; and $848,000 for December. The company have $45,000 cash on hand at the beginning of the fourth quarter.Required:a)Prepare the cash budget of the company. Be sure that you compute the amount of cash to be collected from customers during each month of the fourth quarter.b) Does the company have cash shortage or cash surplus at the end of the year and what amount?

Month October November December On Account $400,000 $690,000 $750,000 Cash $190,000 $220,000 $245,000