Graham Potato Company has projected sales of $9,600 in September, $13,000 in October, $19,600 in November, and $15,600 in December. Of the company's sales, 30 percent are paid for by cash and 70 percent are sold on credit. Experience shows that 40 percent of accounts receivable are paid in the month after the sale, while the remaining 60 percent are paid two months after. Determine collections for November and December. Also assume Grahams cash payments for November and December are $16,500 and $9,000, respectively. The beginning cash balance in November is $5,000, which is the desired minimum balance.

a. Prepare a cash receipts schedule for November and December.

Graham Potato Company
Cash Receipts Schedule
	September	October	November	December
Sales
Credit sales
Cash sales
One month after sale
Two months after sale
Total cash receipts			$0	$0

b. Prepare a cash budget with borrowing needed or repayments for November and December. (Negative amounts should be indicated by a minus sign. Assume the November beginning loan balance is $0.)

Graham Potato Company
Cash Budget
	November	December
Total cash receipts
Total cash payments
Net cash flow	$0	$0
Beginning cash balance
Cumulative cash balance		$0
Monthly borrowing (repayment)		0
Ending cash balance		$0
Cumulative loan balance