No: 2 Jodi Horton, president of the retailer Crestline Products, has just approached the company's bank with a request for a $30.000, 90-day loan. The purpose of the loan support of peak April sales. Because the company has had some difficult loan the company in acquiring inventories in paying off its loans in the past, the ficer has asked for a cash budget to help determine whether the loan should be made. The following data a available for the months April-June, during which the loan will be used: a. On April 1, the start of the loan period, the cash balance will be $26.000. Accounts receivable on April 1 will total $151.500, of which $141.000 will be collected during April and $7.200 will be collected during May. The will be uncollectible. b. Past experience shows that 20 % of a month's sales are collected in the month of sale, 75% in the month following sale, and 4% in the second month following sale. The other 1% represents bad debts that are never collected. Budgeted sales and expenses for the three-month period follow: nder April $200,000 $120,000 $9,000 $15,000 $70,000 $8,000 $10,000 May $300,000 $180,000 $9,000 $15,000 June Sales (all on account) Merchandise purchases Payroll.. Lease payments Advertising Equipment purchases. Depreciation. .. c. Merchandise purchases are paid in full during the month following purchase. Accounts payable for merchandise purchases on March 31, which will be paid during April, total $108.000. d. In preparing the cash budget, assume that the $30.000 loan will be made in April and repaid in June. Interest on the loan will total $1.200. $250,000 $150,000 $8,000 $15,000 $60,000 $80,000 $10,000 $10,000 Required: 1. Prepare a schedule of 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. 21 Haz 2019