Prepare the cash budget for all 4 quarters

Additional info:

The Gavin Tire Company manufactures racing tires for bicycles. Gavin sells tires for $70 each Gavina Other data for Gavin Tire Company: planning for the next year by developing a master budget by quarters Gavin's balance sheet for December Click the icon to view the other data.) 31, 2018, follows Click the icon to view the balance sheet.) Read the requirements Review the cash payments budget you prepared above Gavin Tire Company Cash Budget For the Year Ended December 31, 2019 First Quarter Beginning cash balance 20000 Cash receipts Cash available 101100 81100 Cash available 101100 Cash payments: 25000 Capital expenditures Purchases of direct materials 22960 Direct labor 7080 Manufacturing overhead Selling and administrative expenses Income taxes Interest expense Ending cash balance before financing Minimum cash balance desired Projected cash excess (de ciency) Financing: Borrowing Principal repayments Total effects of financing Ending cash balance Cash Receipts from Customers Total sales First Second Third Fourth Quarter Quarter Quarter Quarter Tot 1 $ 70,000 $ 84,000 $ 98,000 $ 112,000 $30,000 First Second Third Fourth Quarter Quarter Quarter Quarter Total Cash Receipts from Customers: Accounts Receivable balance, December 31, 2018 1st Otr-Cash sales 1st Qtr --Crodit salos, collection of Otr. 1 sales in Otr 1 1st Otr-Credit sales, collection of Qtr 1 sales in Oli 2 30,000 7,000 44,100 18.900 44.100 16,900 8.400 52.920 1st atr.Credit sales, collection of Qtr. 1 sales in Qtr 1 1st Qtr. --Credit sales, collection of Qur. 1 sales in Qtr. 2 2nd Or-Cash sales 2nd Otr. ---Credit sales, collection of Otr. 2 sales in otr. 2 2nd Qir. --Credit salos, collection of Otr. 2 salos in Otr. 3 3rd QtrCash sales 3rd Qtr.-Credit salos, collection of Ctr. 3 sales in Qtr. 3 3rd Qtr --Credit sales, collection of Otr. 3 sales in otr. 4 4th Atr-Cash sales 4th Or-Credit sales, collection of otr 4 sales in Qtr. 4 Total cash receipts from customers 22,680 9.800 61.740 26,460 11,200 70,560 94,220 $ 108,220||$ $ 81,100||$ 80.220$ 383,760 el 2nd Qur-Credit salos, collection of otr. 2 sales in Qtr: 3 3rd Q-Cash salos 3rd Otr.-Credit sales, collection of Qir. 3 sales in Qtr. 3 3rd Qu.--Credit sales, collection of Qtr. 3 sales in Otr. 4 4th Qtr --Cash sales 4th QtrCredit sales, collection of otr. 4 sales in Otr. 4 Total cash receipts from customers 9.800 61,740 $ 26,460 11.200 70,560 94,220 $ 108,220||$ S 81,100 $ 80.220$ 363.760 Accounts Receivable balance, December 31, 2019: 4th Or --Credit sales, collection of Otr 4 sales in Otr. 1 of 2020 $ 30,240 Cash Payments First Second Third Fourth Quarter Quarter Quarter Quarter $ 13,920 $ 13,600 $ 15,600 $ 13,080 $ First Second Third Fourth Quarter Quarter Quarter Quarter Total 56,200 Total direct materials purchases Total Cash Payments Direct Materials: Accounts Payable balance, December 31, 2018 1st Otr-Otr. 1 direct material purchases paid in Otr 1 1st at. --Ou. 1 direct material purchases paid in Qtr 2 16,000 6,960 S 6,960 ver wald $ 6,800 7,800 JU 5 7,800 2nd Or-tr. 2 direct material purchases paid in Otr. 3 3rd Qir.-Qtr. 3 direct material purchases paid in Otr3 3rd Otr-tr. 3 direct material purchases paid in Qtr. 4 4th Qt-Otr 4 direct material purchases paid in Qtr. 4 Total payments for direct materials 6,540 14,340 $ ple acid 22,960 13,760 14,600 65,650 ty 901 Direct Labor: Total payments for direct labor 7,080 7,680 8,880 10,080 33,720 Manufacturing Overhead: Mariahla manufachwinn urheart 2. Aan 2 ani Innl IL RAN Utilities, insurance, property taxes Total payments for manufacturing overhead 10:380 10.800 10,860 14.400 14,700 10,86 15,900 15,300 8,000 8.000 8,000 4,800 Selling and Administrative Expenses: Salaries Expense Rent Expense Insurance Expenso Supplies Exponse Total payments for Selling and Admin. expenses 32,000 19.200 4,800 1,950 1.680 4,800 1950 1.950 8,000 4.800 1,950 2.240 7.800 7.280 1.400 16,150 1.960 16.710 16,430 16.990 66.280 Income Taxes: Income Taxes: Total payments for income taxes 3,500 3,500 3,500 14,000 Capital Expenditures: Total payments for capital expenditures 25,000 25,000 Total cash payments (before interest) 89,090 $ 56,070 S 58,990 60,810 $ 264,960 Accounts Payable balance, December 31, 2019: 4th Otr-Otr. 4 direct material purchases paid in Or 1 of 2020 6,540 - Gavin Tire Company Balance Sheet December 31, 2018 Assets -a " pard Current Assets: dollar. Er Cash 20,000 Accounts Receivable win Raw Materials Inventory 30,000 3,000 10,800 Cas Finished Goods Inventory Total Current Assets Eng 63,800 Property, Plant, and Equipment: EKA Less: Accumulated Depreciation (39,000) 129,000 Total Assets $ 192,800 Liabilities " are 16,000 Current Liabilities: Accounts Payable $ Stockholders' Equity Common Stock, no par 130,000 Retained Earnings 46,800 Total Stockholders' Equity $ Total Liabilities and Stockholders' Equity m ca nd 176,800 192,800 (Unless otherwise noted, assume all of the following events occurred during 2018 and that any balances given are stated as of December 31, 2018.) Budgeted sales are 1,000 tires for the first quarter and expected to increase by 200 tires per quarter. a. Cash sales are expected to be 10% of total sales, with the remaining 90% of sales on account. b. Finished Goods Inventory on December 31, 2018 consists of 300 tires at $36 each. Desired ending Finished Goods Inventory is 40% of the next quarter's sales; first quarter sales for 2020 c. are expected be 1,800 tires. FIFO inventory costing method is used. Raw Materials Inventory on December 31, 2018, consists of 750 pounds of rubber compound used to d. manufacture the tires. Direct materials requirements are 2.50 pounds of a rubber compound per tire. The cost of the e. compound is $4.00 per pound. Desired ending Raw Materials Inventory is 40% of the next quarter's direct materials needed for production; desired ending inventory for December 31, 2019 is 750 pounds; indirect materials are f. insignificant and not considered for budgeting purposes. 9. Each tire requires 0.30 hours of direct labor; direct labor costs average $20 per hour. TYTUT Fixed manufacturing overhead includes $6,000 per quarter in depreciation and $10,860 per quarter for i. other costs, such as utilities, insurance, and property taxes. Fixed selling and administrative expenses include $8,000 per quarter for salaries; $4,800 per quarter for i rent; $1,950 per quarter for insurance; and $2,000 per quarter for depreciation. k. Variable selling and administrative expenses include supplies at 2% of sales. Capital expenditures include $25,000 for new manufacturing equipment, to be purchased and paid in 1. the first quarter. Cash receipts for sales on account are 70% in the quarter of the sale and 30% in the quarter following the sale; December 31, 2018, Accounts Receivable is received in the first quarter of 2019, uncollectible m. accounts are considered insignificant and not considered for budgeting purposes. Direct materials purchases are paid 50% in the quarter purchased and 50% in the following quarter; n. December 31, 2018, Accounts Payable is paid in the first quarter of 2019. Direct labor, manufacturing overhead, and selling and administrative costs are paid in the quarter o incurred. p. Income tax expense is projected at $3,500 per quarter and is paid in the quarter incurred. vandle semng anu auminsauve expenses include suppres al 27 Ur Sales. Capital expenditures include $25,000 for new manufacturing equipment, to be purchased and paid in 1. the first quarter. Cash receipts for sales on account are 70% in the quarter of the sale and 30% in the quarter following the sale: December 31, 2018, Accounts Receivable is received in the first quarter of 2019; uncollectible m. accounts are considered insignificant and not considered for budgeting purposes. Direct materials purchases are paid 50% in the quarter purchased and 50% in the following quarter: n. December 31, 2018, Accounts Payable is paid in the first quarter of 2019. Direct labor, manufacturing overhead, and selling and administrative costs are paid in the quarter o incurred. p. Income tax expense is projected at $3,500 per quarter and is paid in the quarter incurred. Gavin desires to maintain a minimum cash balance of $20,000 and borrows from the local bank as needed in increments of $1,000 at the beginning of the quarter; principal repayments are made at the beginning of the quarter when excess funds are available and in increments of $1,000; interest is 12% per year and paid at the beginning of the quarter based on the amount outstanding from the previous 4. quarter