Lorch Company prepares monthly cash budgets. Relevant data from operating budgets for 2021 are as follows: January $348,000 February $400,000 Sales Direct materials purchases 119.000 108,000 Direct labour 85.000 112,000 Manufacturing overhead 60,000 74,000 Selling and administrative expenses 75,000 81,000 All sales are on account. Lorch expects collections to be 50% in the month of sale, 40% in the first month following the sale, and 10% in the second month following the sale. It pays 30% of direct materials purchases in cash in the month of purchase and the balance due in the month following the purchase. Other data are as follows: 3 1. Credit sales: November 2020, $201,000, December 2020. $278,000 2. Purchases of direct materials: December 2020, 590,000 Other receipts: January-collection of December 31, 2020. notes receivable $4.000; February-proceeds from sale of securities 56,000 4. Other disbursements: February--payment of $20,000 for land The company expects its cash balance on January 1, 2021. to be $50,000. It wants to maintain a minimum cash balance of $40,000. Prepare schedules for (1) the expected collections from customers. Month January February November $ ta December January February $ $ $ ta (2) the expected payments for direct materials purchases. Month January February December ta $ January February $ $ e Textbook and Media Prepare a cash budget for January and February using columns for each month. LORCH COMPANY Cash Budget For the Two Months Ending February 28, 2021 Jan Feb Beginning cash balance Add: Cash receipts Total receipts Total available cash Less: Disbursements . Total disbursements Excess of cash available over cash disbursements Financing Borrowing + 2 Total financing Ending cash balance