GH apter 10 Livanos, Inc. records all its sales as credit sales and pays cash operating costs in the month incurred. Amounts for 2017 are given in the table that follows. Additional assumptions are: 1) Amounts due from customers are collected 40% in the month of sale and 60% in the following month, 2) The ratio of Cost of goods sold to sales is 65%; 3) Livanos pays for inventory purchases 20% in the month of the purchase and 80% in the following month, 4) Monthly operating expenses are: Salaries, $60,000, Depreciation, $25,000, Rent, $20,000, and Utilities, $3,000 5) Accounts payable is only used for inventory acquisitions. Use the following worksheet to determine the ending cash balance in May, assuming the beginning cash balance in April is $180,000. March April 400,000 $300,000 $280,000 $250,000 $500,000 May June July Budgeted sales Ex 2 May June July March $400,000 $300,000 $280,000 $250,000 $500,000 $120,000 April Budgeted sales Budgeted purchases $112,000 $100,000 $200,000 $240,000 Cash Account April May Budget Debit Credit Debit Credit March April May Tune s 400,000 240,000 S 300,000 s 280,000 s 250,000 Cash Collections are Debits to the Cash account S 180,000 Ex 2 Ex 3 Ex4E Ex T kbook Virw July $ 500,000 Purchases Cash Disbursements 120,000 s 112,000 $ 100,000 $ 200,000 $ 240,000 s 60,000 S 20,000 S 25,000 S 30,000 $ 96,000 March April May June July are Credits to the 89,600 Cash account laries Depreciation Utilities Totals Net Increase (decrease) note inconsistency with above ation S 25,000 Utilities Totals Net Increase (decrease) $ 30,000 Opening Cash Balance Ending Cash Balance $ 180,000 5 384,000