Nuttsies Uniforms has been in business since January of the current year. The company buys medical supplies and clothing and resells them to doctors and nurses. The following information pertains to Nuttsies Uniforms first four months of operations:

Purchases Sales

Jan. $45,000 $67,000

Feb. 37,000 54,000

Mar 49,000 70,000

Apr. 29,000 47,000

Nuttsies Uniforms expects to open several new sales territories in May. In anticipation of increased volume, management forecasts May sales at $77,000. To meet this demand, purchases in May are budgeted at $47,000.

All of Nuttsies Uniforms sales are on account. Due to strict credit policies, the company has no bad debt expense. The following collection performance is anticipated for the remainder of the year:

Percent collected in month of sale. 30%

Percent collected in month of following sale 60%

Percent collected in the second month following sale.. 10%

Nuttsies Uniforms normally pays for 80 percent of its purchases in the month that the purchases are made. The remaining amount is paid in the following month. The companys fixed selling and administrative expenses average $12,000 per month, of which $4,000 is depreciation expense. Variable selling and administrative expenses are budgeted at 5 percent of sales. The company pays all of its selling and administrative expenses in the month that they are incurred. In addition, Nuttsies Uniforms makes a loan payment of principal and interest expense of $4,000 in May.

Instructions: Prepare Nuttsies Uniforms cash budget for May. Assume that the companys cash balance on May 1st is $20,000.