On July 1, MTC Wholesalers had a cash balance of $87,500 and accounts payable of $49,500. Actual sales for May and June, and budgeted sales for July, August, September, and October are:

Month Actual Sales Month Budgeted Sales

May $75,000 July $ 45,000

June 80,000 August 40,000

September 50,000

October 60,000

All sales are on credit with 75 percent collected during the month of sale, 20 percent collected during the next month, and 5 percent collected during the second month following the month of sale. Cost of goods sold averages 70 percent of sales revenue. Ending inventory is one-half of the next month's predicted cost of sales. The other half of the merchandise is acquired during the month of sale. All purchases are paid for in the month after purchase. Operating costs are estimated at $14,000 each month and are paid during the month incurred.

Required Prepare purchases and cash budgets for July, August, and September.

Do not use a negative sign with your answers.

MTC Wholesalers

Purchases Budget

	July	August	September
Inventory required, current sales	Answer	Answer	Answer
Desired ending inventory	Answer	Answer	Answer
Total inventory needs	Answer	Answer	Answer
Less beginning inventory	Answer	Answer	Answer
Purchases	Answer	Answer	Answer

Do not use a negative sign with your answers.

MTC Wholesalers
Cash Budget
For the Months of July, August, and September
		July	August	September
Cash balance, beginning		Answer	Answer	Answer
Cash receipts
Current month's sales		Answer	Answer	Answer
Previous month's sales		Answer	Answer	Answer
Sales two months prior		Answer	Answer	Answer
Total receipts		Answer	Answer	Answer
Cash available		Answer	Answer	Answer
Cash disbursements:
Purchases		Answer	Answer	Answer
Operating costs		Answer	Answer	Answer
Total disbursements		Answer	Answer	Answer
Cash balance, ending		Answer	Answer	Answer