Minimum ending cash balance

Cost of Goods Sold $($as a percentage of sales$)$

Gross margin $($as a percentage of sales$)$

Recent and forecast sales $($in units$)$:

March $($actual$)$

April

May

June

July

Desired ending inventories

$($percentage of next month's cost of goods sold$)$

Purchases paid as follows:

In month of purchase

In following month

Collection on sales:

Cash sales

Credit sales

All payments on credit sales are collected in the month following the sale.

Variable monthly expenses:

Shipping expenses $($as a percentage of sales$)$

Other expenses $($as a percentage of sales$)$

Fixed monthly expenses:

Wages and salaries

Advertising

Depreciation $($per quarter$)$

Equipment purchased in April

Equipment purchased in May

Dividends declared each quarter $($paid at the end of Qtr$.)$

Balance sheet at March $31$:

Cash

Accounts receivable

Inventory

Fixed assets, net of depreciation

Total assets

Assets

Liabilities and Stockholders' Equity

Accounts payable

Capital stock

Retained eamings

Total liabilities and stockholders' equity

Agreement with Bank:

Maximum borrowing amount

Repayment increments

Required minimum cash balance

Interest rate $($per month$)($not compounded$)$

$$,8,000$

$60\%$

$40\%$

$60,000$

$70,000$

$85,000$

$90,000$

$50,000$

$30\%$

$80\%$

$

$

$

$20,000$

$1)$ Create a cash budget.