On January 1, Sweet Pleasures, Inc., begins business. The company has $14,000 cash on hand and is attempting to project cash receipts and disbursements through April 30. On May 1, a note payable of $10,000 will be due. This amount was borrowed on January 1 to carry the company through its first four months of operation. The unit purchase cost of the companys single product, a box of Sweet Pleasures chocolates, is $12. The unit sales price is $28. Projected purchases and sales in units for the first four months are: Purchases Sales January 2,400 1,200 February 2,600 2,400 March 2,500 2,500 April 3,100 2,700 Sales terms call for a 5% discount if paid within the same month that the sale occurred. It is expected that 50% of the billings will be collected within the discount period, 25% by the end of the month after purchase, 19% in the following month, and 6% will be uncollectible. Approximately 60% of the purchases are paid for in the month purchased. The rest are due and payable in the next month. Total fixed marketing and administrative expenses for each month include cash expenses of $5,000 and depreciation on equipment of $2,000. Variable marketing and administrative expenses total $6 per unit sold. All marketing and administrative expenses are paid as incurred.

Please show formulas. Thank you.

E F . B D 4 5 Data Section 6 7 Beginning cash balance, January 1 $14,000 8 Sales: 9 Unit sales price $28.00 10 January estimated units 1,200 11 February estimated units 2,400 12 March estimated units 2,500 13 April estimated units 2,700 14 Collections: 15 Cash discount (%) 5% 16 % Collected current month 50% 17 % Collected next month 25% 18 % Collected following month 19% 19 % Uncollectible 6% 20 Purchases: 21 Unit purchase cost $12 22 January planned purchases (units) 2,400 23 February planned purchases (units) 2,600 24 March planned purchases (units) 2,500 25 April planned purchases (units) 3,100 26 % Paid in month purchased 60% 27 % Paid in month after purchase 40% 28 Marketing & administrative: 29 Fixed cash expenses per month $5,000 30 Depreciation per month $2,000 31 Variable cost per unit sold $6 32 33 Answer Section 34 35 Sweet Pleasures Inc. 36 Cash Budget 37 38 January February March 39 Cash balance, beginning FORMULA1 $0 40 Add receipts: 41 Collections January sales FORMULA2 FORMULA FORMULA4 42 Collections February sales 0 0 43 Collections March sales 0 44 Collections April sales 45 Total available SO SO SO 46 Less disbursements: 47 Purchases made in January FORMULAS FORMULA6 48 Purchases made in February 0 SO 49 Purchases made in March 0 50 Purchases made in April 51 Fixed marketing & admin FORMULA7 0 52 Variable marketing & admin. FORMULAS 0 0 53 Total disbursements SO SO SO 54 Cash balance, ending SO SO SO 55 CA 30 April SO 0 0 0 SO 0 0 SO 0 0 0 SO SO