PART 4: CASH BUDGET WITH BAD DEBTS AND BORROWING Refer to the information for Parts 1,23 The company's managers budget cash flows on a Quartetty baras so that they can plan short term Investments and borrowings Cebutar phone sales are highed during the spring and summer Sales are baiety even within each quarter, but sales vary across quarters as follows. January March 10% Apr June 50% JUST 30% October December 105 Accounts receivable at the end of the prior RAL corating of sales made during December totaled 5180,000 Payments from customers are usually received as follows Par during the month good are received Payme next month 5.02 Bad Osts OS The company pays it vendors 10 days afla raw materials are received, so approximately 80% of purchases are paid in the month of production and 20% are paid the following month Accounts payable at the end of the prior year totalled 5130,000, Employee wages and other production costs are paid during the month incurred Property taxes are paid in two equal installments on March 31 and September 30, and insurance is paid annually on June 30 Support costs are paid evenly throughout the year Estimated income tax payments are made at the end of the gender based on 25% of total estimated Laxes for the year in addition to customer receipts, the company expects to receive $10,000 in proceeds from the sale of equipment during January The company also plans to purchase and pay for new equipment costing $100.000 in January The company finances its shorHerm operations with a line of and from the bank which had a balance of $500.000 at the end of the prior year. The line of credit requires quarterly interest rates payments at an annual rate of 55 (For simplicity, aume that wil barrowing and repayments occur on the last day of each quarter 1) Prepare Quarterly budgets for cash receipts, cash disbursements and short-term financing C27 PART 4: CASH BUDGET WITH BAD DEBTS AND BORROWING Refer to the information for Parts 1,23 The company's managers budget cash flows on a Quartetty baras so that they can plan short term Investments and borrowings Cebutar phone sales are highed during the spring and summer Sales are baiety even within each quarter, but sales vary across quarters as follows. January March 10% Apr June 50% JUST 30% October December 105 Accounts receivable at the end of the prior RAL corating of sales made during December totaled 5180,000 Payments from customers are usually received as follows Par during the month good are received Payme next month 5.02 Bad Osts OS The company pays it vendors 10 days afla raw materials are received, so approximately 80% of purchases are paid in the month of production and 20% are paid the following month Accounts payable at the end of the prior year totalled 5130,000, Employee wages and other production costs are paid during the month incurred Property taxes are paid in two equal installments on March 31 and September 30, and insurance is paid annually on June 30 Support costs are paid evenly throughout the year Estimated income tax payments are made at the end of the gender based on 25% of total estimated Laxes for the year in addition to customer receipts, the company expects to receive $10,000 in proceeds from the sale of equipment during January The company also plans to purchase and pay for new equipment costing $100.000 in January The company finances its shorHerm operations with a line of and from the bank which had a balance of $500.000 at the end of the prior year. The line of credit requires quarterly interest rates payments at an annual rate of 55 (For simplicity, aume that wil barrowing and repayments occur on the last day of each quarter 1) Prepare Quarterly budgets for cash receipts, cash disbursements and short-term financing C27