Cho8 (i) Sines: Heip Save \& Exit Submit Check my work Required: 1. Caiculate the expected cash collections for April, May, and June, and for the three months in total. 2. Prepare a cash budget, by month and in total, for the three-month period. Complete this question by entering your answers in the tabs below. Calculate the expected cash collections for April, May, and June, and for the three months in total. The president of the retailer Prime Products has just approached the company's bank with a request for a $61,000,90-day loan. The purpose of the loan is to assist the company in acquiring inventories. Because the company has hod some difficulity in paying off its loons in the past, the loan officer has asked for a cash budget to help determine whether the loan should be made. The following data are avalable for the months April through June, during which the loan will be used: A. On April 1, the start of the loan peniod, the cash balance will be $42,500. Accounts tecelvable on April 1 will totai $165,200, of which $141,600 wil be collected during April and $18,880 will be collected during May. The remainder wili be uncollectible. b. Past expetience shows that 30% of a month's sales are collected in the month of sale, 60% in the month following sale, and 8% in the second month following sale. The other 2% is bad debts that are never collected. Budgeted sales and expenses for the threemonth period follow c. Merchandise purchases are paid in full during the month following purchase Accounts payable for merchandise purchases during March witich witi be paid in Apri, total $5150,500 d. in preparing the cash budget, assume that the $51,000 ioan will be made in Aprit and repaid in June. interest on the loan wiil total 5000 Cho8 (i) Sines: Heip Save \& Exit Submit Check my work Required: 1. Caiculate the expected cash collections for April, May, and June, and for the three months in total. 2. Prepare a cash budget, by month and in total, for the three-month period. Complete this question by entering your answers in the tabs below. Calculate the expected cash collections for April, May, and June, and for the three months in total. The president of the retailer Prime Products has just approached the company's bank with a request for a $61,000,90-day loan. The purpose of the loan is to assist the company in acquiring inventories. Because the company has hod some difficulity in paying off its loons in the past, the loan officer has asked for a cash budget to help determine whether the loan should be made. The following data are avalable for the months April through June, during which the loan will be used: A. On April 1, the start of the loan peniod, the cash balance will be $42,500. Accounts tecelvable on April 1 will totai $165,200, of which $141,600 wil be collected during April and $18,880 will be collected during May. The remainder wili be uncollectible. b. Past expetience shows that 30% of a month's sales are collected in the month of sale, 60% in the month following sale, and 8% in the second month following sale. The other 2% is bad debts that are never collected. Budgeted sales and expenses for the threemonth period follow c. Merchandise purchases are paid in full during the month following purchase Accounts payable for merchandise purchases during March witich witi be paid in Apri, total $5150,500 d. in preparing the cash budget, assume that the $51,000 ioan will be made in Aprit and repaid in June. interest on the loan wiil total 5000
