High company prepares monthly cash budgets. Relevant data from operating budgets for 2019 follow:

	January	February
Sales	$350,000	$400,000
Direct materials purchases	120,000	130,000
Direct labour	80,000	100,000
Manufacturing overhead	70,000	75,000
Selling and administrative expenses	89,000	91,000

All sales are on account. Collections are expected to be 45% on the month of sale, 30% in the first month following the sales, and 25% in the second month following the sale. Sixty percent of direct materials purchases are paid in cash in the month of purchase, and the balance due is paid in the month following the purchase. All other items above are paid in the month incurred. Selling and administrative expenses include $4,000 of depreciation per month.

Other data:

1. Credit sales: November 2018, $ 260,000; December 2018, $ 300,000.
2. Purchase of direct materials: December 2018, $10,000.
3. Other receipts: January collection of December 31, 2018, notes receivable, $10,000; February proceeds from sale of securities, $ 6,000.
4. Other disbursements: February withdrawal of $ 5,000 cash for personal use of owner.

The companys cash balance on January 1, 2019 is expected to be $ 60,000. The company wants to keep minimum cash balance of $ 50,000.

Required:

1. Prepare schedules for collections from customers and payments for direct materials purchases.

2. Prepare a cash budget for January and February with columns for each month.